US Lawmakers Urge Treasury to Revise Proposed Digital-Assets Taxation Regime

According to CoinDesk, a group of bipartisan U.S. lawmakers, led by Chairman of the House Financial Services Committee Patrick McHenry (R-NC) and Congressman Ritchie Torres (D-N.Y), have urged the Treasury to revise its proposed digital-assets taxation regime. The group, which includes nine lawmakers, supports crypto representatives and lawyers who have called the proposed taxation scheme 'dangerous and improper overreach.' They claim the tax reporting requirement is 'unworkable' and could prevent a large swath of the digital asset ecosystem from continuing to exist in the United States. The crypto tax rule was proposed in August, and a public comment period ended Monday after more than 124,000 comments. At a recent audio-only hearing, questions from officials to the industry revealed that the tax proposal may be 'open for revision.' A final version is likely months away and could see a response to at least some of the industry's condemnation. The major sticking point is how the proposal captures hosted wallet providers, payment processors, some decentralized finance (DeFi) entities, and others as 'brokers' for tax reporting purposes. The lawmakers' letter to the U.S. Treasury Department's Assistant Secretary Lily Batchelder stated that the definition of 'Broker' remains too broad and would capture entities that do not possess traditional characteristics of a broker.