A new cryptocurrency tax reporting mandate is expected to become law once President Joe Biden signs the measure, according to a Monday (Nov. 8) report from The Verge.
The cryptocurrency regulation was an add-on to the $1.2 trillion infrastructure plan, which Congress passed on Friday, according to the report.
The impending law would require that businesses report digital asset transactions of more than $10,000 to the IRS, according to PYMNTS. In addition, anyone involved in the transfer of digital coins would need to report the information to the IRS. In all, the crypto tax regulation is expected to yield $28 billion over 10 years, according to PYMNTS.
As originally proposed in July, the IRS would have authorization to seek taxes owed that the government had not known about since the transactions were not required to be reported, according to PYMNTS.
Related: Crypto Tax Laws Slipped Into $1T Infrastructure Bill
In August, the then-proposed legislation received a few last-minute additions and clarifications amid concerns from lobbyists, according to PYMNTS. Among the amendments was a call for bolstered scrutiny of the cryptocurrency sector that would require crypto traders to adhere to the same IRS regulations as stock and bond brokers.
In addition, language was revised to “clarify” what constitutes a broker. Instead of zeroing in on “any decentralized exchange or peer-to-peer marketplace,” the wording was amended to a broader definition: brokers are individuals “responsible for regularly providing any service effectuating transfers of digital assets on behalf of another person.”
The cryptocurrency industry has said that the stepped-up tax enforcement should not apply to various industry representatives, including miners, creators, or “node operators,” according to PYMNTS.
See also: Crypto Lobbying Efforts Get Small Win In Infrastructure Bill
Wording amendments were meant to find a compromise for portions of the infrastructure bill specifically pertaining to cryptocurrency and brokers’ reporting requirements to the IRS, according to PYMNTS. Crypto users had voiced concerns that the new law could deter others involved in the industry aside from brokers.
Read more: Treasury On Board With Bipartisan Crypto Senate Deal
Crypto groups have mobilized efforts to fight the impending law, according to The Verge.
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