Senate rejects amendment to exclude US Bitcoin companies from brokerage regulation

The U.S. Senate on Monday rejected a bipartisan amendment aimed at clarifying the tax filing requirements required for brokers supporting the Bitcoin economy, Forbes reported.

The news comes after days of debate and a last-minute press conference by Senators Pat Toomey (R-PA) and Cynthia Lummis (R-WY) trying to address the problematic language contained in the $ 1.2 trillion infrastructure bill and felt by many industry participants was too broad and detrimental to innovation.

Instead, the provision continues unchanged and potentially opens the door to non-financial Bitcoin intermediaries such as network validators, software contributors, miners and other service providers covered by the included definition.

Many of these parties, by definition, never take control of a consumer’s assets – a fact that sparked widespread outrage over the law.

The impact of rejecting this change could be significant to all bitcoin mining companies, node operators, and bitcoin and lightning developers as they could all be forced to share transaction information with the IRS. What’s noteworthy, however, is that the brokerage of any of these companies could still be challenged – and overturned – in US courts.

Notably, the Senate would have opposed a proposed amendment that would have put cryptocurrency brokers’ definition of tax reporting on transactions that would have facilitated the IRS over $ 10,000. As Toomey and Lummis protested, the language of the 2,702-page Infrastructure Act is currently broad and comprehensive.

According to Forbes, Senator Richard Shelby (R-Ala.) Objected to Senator Toomey’s motion for unanimous approval of the amendment, which prevented the amendment from being adopted. However, Forbes reported that Shelby would forego his appeal if the Senators included an independent amendment to increase military spending by $ 50 billion. Senator Bernie Sanders (I-Vt.) Rejected this proposal out of concern for the climate.

Senators Toomey, Lummis, Warner (D-VA), Portman (R-OH) and Sinema (D-AZ) had signed the amendment introduced on Monday. His intent was to clarify a language that could potentially be aimed at anyone facilitating a transaction on someone else’s behalf.

“Developers are the lifeblood of innovation, and taxing them would have far-reaching implications for privacy and technology development in this country – not to mention that most developers would not have access to useful data.” [for the IRS]”Forbes reported from Lummis.

According to Forbes, the Joint Committee of Congress estimates that the broad and comprehensive proposal for mandatory reporting will raise $ 28 billion in taxes over the next decade.

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