As the U. S. house of Representatives prepares to vote on the Senate 1 Vote on a trillion dollar bipartisan infrastructure Bill , Tax lawyers are awaiting guidance from the federal Treasury on the proposed encrypted reporting provisions it contains .
8 month , The encryption industry has worked together to amend the provisions of the comprehensive act , The bill seems to “ agent ” The definition of is extended beyond cryptocurrency exchanges and similar types of trading platforms , May include miners 、 Node validators and developers , Other types of entities that do not facilitate customer transactions .
Despite calls from both parties to amend the bill , But it's in 8 month 11 It passed the Senate in its original form , The house of representatives will now be in 9 month 27 Vote on the unmodified Bill .
Legal experts warn that , If the bill is implemented as it seems , Some industry participants may not be able to comply with .
for example , according to Skadden, Arps, Slate, Meagher & Flom LLP Partners Nathan Giesselman That's what I'm saying , The original form of terms risks capturing people who cannot have the same customer information as traditional brokers , Put these people where they can't comply with the required reports .
“ They either have to stop their activities , Or accept violations , And bear the risk of relevant penalties ,” Giselman said .
Independent tax policy analysis group Tax Foundation Policy analysts Alex Muresianu and Garrett Watson Express , Written reporting requirements “ It may not work ”.
However , Earlier this month , There are reports that the Ministry of Finance plans to clarify “ agent ” The definition of . In a Bloomberg report , An unnamed finance ministry official said , The Department will insist on 《 Internal revenue law 》(IRC) Chinese vs “ agent ” The definition of , Not against entities that do not belong to the law .IRC take “ agent ” Defined as “(A) Dealer ,(B) Barter exchange , as well as (C) Any other （ For consideration ） A person who often acts as an intermediary for property or services ”, But does not include “ people ” About managing the farm on behalf of others .
Although the industry's hopes will soon depend on the Treasury's own guidance on the provision , But some American tax lawyers do not fully believe , If the bill itself is not amended , The Treasury will continue to narrow the definition of broker .
Baker & McKenzie Partner and the law firmThe editor of the blog David Zaslowsky Express ：“ That sounds good news , But it is not clear whether what they are saying is what they will actually do in practice .”
’ You will never know ’
Earlier this year ,Zaslowsky Co authored a report on the IRS (IRS) how “ Actively collect ” Encrypted transaction tax in an attempt to increase tax reporting . according to Zaslowsky That's what I'm saying , The IRS's intention is clearly expressed by placing a question about encrypted transactions at the top of an individual tax return .
Due to the new regulations, it is expected that 10 Help raise... During the year 280 Billion dollars , The IRS's intention to increase revenue and combat tax evasion remains unchanged .
“ The Treasury's view is , Not everyone should report to them ,” Zaslovsky said .
Giesselman say , According to the proposed Provisions , The cryptocurrency exchange will be required to continue publishing 1099 A non employment income form , He added that he was not sure how many transactions there were at present, so it was reported in a manner consistent with the proposed rules .
Zaslowsky say , However , The commotion is not because trading platforms and exchanges may not report correctly and are bound by new reporting requirements , But because a broad definition captures entities like miners who do not have the information they seek . He added , By using something similar to the existing definition of broker , The former will be captured , The latter will not be captured , Then the Treasury's revenue will increase .
“ But will this really happen ？ This is caring , isn't it? ？ You never know ,” Zaslovsky said .
NFT and DeFi Well ？
Giesselman forecast , In practice , Cryptocurrency exchanges will be the main focus of the new reporting requirements .
CoinTracker Head of tax strategy Shehan Chandrasekera Agree with this .
“ I think the Treasury will strictly apply the broker rules for cryptocurrency transactions . This involves like Coinbase Such a centralized exchange , It may also involve things like Uniswap Such decentralized exchanges ,”Chandrasekera say .
Although the reporting requirements will cover the exchange , but Giesselman Also said ,The scope of institutions beyond these trading platforms is still uncertain .
“ Whether it will choose a company that decides to forge its own stable coins 、 Forge your own cryptocurrency 、 Their own [ There is no substitute for tokens ] And sold on the market ？ Will these be caught ？” Giselman said .
Encryption tax software provider TaxBit Head of global information reporting Erin Fennimore Express , Under the current infrastructure act ,NFT And decentralized Finance (DeFi) Will be regarded as “ agent ”.Troutman Pepper Technology and blockchain partners Joe Guagliardo agree! Fennimore Point of view , To weigh NFT Inclusion in the definition is not controversial .
The current draft law is due to 2023 It won't take years to take effect .
“ So all this is on the way . But the problem comes back to the fact that ： If the definition is broad enough , To cover parties who are not required to report information due to their mode of operation , Then you have a problem ,”Zaslowsky say .
Giesselman Think , The implementation of the law will be similar to 2010 Effective 《 Foreign account tax compliance act 》( FATCA ).FATCA Trying to crack down on tax evasion by Americans holding overseas assets and bank accounts , Financial assets held abroad are required to report to the IRS .
But initially FATCA The requirements are notoriously complex , Everyone thinks there's a problem here , Lack of information to fix ,Giesselman explains .
“ In the real world ,[FATCA The rules ] How to write in a manageable way , It will take years to correct . And there are rounds of comments . I think the Treasury worked very hard to listen to what came in ,” Giselman said .
according to Giesselman That's what I'm saying , If the bill becomes law , So in terms of encrypted tax terms , The Treasury may move in one or two directions . In one case , The Ministry of Finance may issue proposed compliance guidelines （ It has no legal effect until it is finally determined ）, And solicit public opinions . The Ministry of finance will then consider the comments received , And may amend or clarify the proposed regulation before issuing the final regulation .
In another case , The Ministry of Finance may issue proposed and interim regulations （ It's usually the same ）. But in this case , Temporary provisions shall have immediate legal effect ,Giesselman explains . then , There will be a consultation period , The final regulations may be issued in the form of amendments .
in consideration of 2023 The proposed effective date in ,Giesselman Express , We can see that the initial deployment takes either way , It depends on how long it will take the Treasury to prepare the guidelines .
“ If you want to go to 2022 end of the year , We may use the second approach （ So that the provisional regulations will come into force when the law comes into force ）, And if they can 2022 The proposed regulations were introduced at the beginning of the year , We may look forward to the previous route ,” Giselman said in an email .
Giselman said , In another case , The Treasury may take a similar approach , be used for 2017 year 《 Tax cuts and jobs act 》 Some of the terms of , It aims to reduce the tax rate of enterprises and individuals . The Ministry of Finance may issue a notice , Describe in detail some key rules that will be included when the regulation is issued , And allow taxpayers to rely on these rules until they are finalized .
Giesselman say ：“ for example , If there is a strong desire to limit the scope of being considered a broker , Then it is likely to be completed by notification , The progress of the overall guidance program will be slower .”
No matter how the Treasury explains “ agent ” The word" ,Fennimore It means that change is inevitable .
“ Although this is a procedural change , But not ‘ It won't work ’.” It involves implementation processes and procedures as well as technology , To facilitate the collection of the required information to IRS The report . The best advice is to start preparing as soon as possible , Finnimore said .
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