Official announcement from the U.S. Treasury Department or IRS

U.S. Treasury Finalizes Crypto Tax Reporting Rules for Brokers in 2025, Delays DeFi Regulations

Jun 28, 2024, 08:46 PM

The U.S. Treasury Department and the IRS have finalized a new tax reporting rule for cryptocurrency brokers, including exchanges and payment processors. This rule mandates that brokers report users' transactions to the IRS, aiming to curb tax evasion in the cryptocurrency market. The finalized regulations, set to take effect in 2025, will require brokers to report gross proceeds on the sale of digital assets starting in 2026 and tax basis information beginning in 2027. The 365-page document outlines these requirements, which were refined through industry feedback, including 44,000 comments. However, the Treasury has delayed rules for non-custodial entities, such as DeFi and self-hosted wallets, as it continues to study the implications and feedback from the industry. This decision is seen as a significant policy win for the DeFi sector, which will not be subject to the new reporting requirements for now. The finalized rule follows the tax provisions outlined in the 2021 Infrastructure Bill.