US Approves $1.2 Trillion Infrastructure Bill Including Crypto Tax

The US House of Representatives has passed the $1.2 trillion bipartisan infrastructure bill. This, if signed by President Joe Biden, would enforce new provisions pertaining to crypto tax reporting for all citizens.

Legislative proposal already approved

The administration of current President Joe Biden originally came up with the proposal. The main aim of the proposal was to significantly improve national transport networks and internet coverage. The new bill also proposed significantly tightening reporting requirements for the crypto community. As a result, all transactions involving digital assets such as Bitcoin (BTC) valued at $10,000 or more must be reported to the IRS. This is not entirely unusual, a similar construction is also active in the Netherlands.

Although the bill was first approved on August 10, it was asked to reach a compromise with 6 US senators. They said the following:

“This legislation imposes a deeply flawed, and in some cases unworkable, cryptocurrency tax reporting mandate that threatens future technological innovation.”

While much of the wording of the bill lacks clarity, the infrastructure law is reportedly primarily intended to treat the crypto community’s software developers, transaction validators and node operators as the brokers of the traditional institutions. As a result, they are treated slightly differently for tax purposes.

228 votes in favor and 206 votes against

However, the US House of Representatives passed the controversial infrastructure bill after winning by 228 votes to 206. The number of votes for and against was very close to each other. In addition, the crypto community expressed concern about the vague definition of the word “broker”, which can consequently impose unrealistic tax reporting requirements on sub-communities, such as the crypto miners.

As a result, the inability to disclose crypto-related earnings will simply be treated as a tax violation and financial crime. Also on Twitter several people did not fully agree with the new rules.