U.S. Rep. Mike Carey (R-OH) introduced a resolution in the House that would roll back the Internal Revenue Service’s Digital Assets Sale and Exchanges Rule.
The rule requires custodial brokers to report sales and exchanges of digital assets, including cryptocurrency. These reporting requirements are designed to help taxpayers to file accurate tax returns with respect to digital asset transactions, which are already subject to tax under current law, according to the IRS. It requires brokers to report certain sale and exchange transactions that take place beginning in calendar year 2025 on Form 1099-DA.
Carey said the rule is an overreach by the IRS. Further, he said it would result in over 8 billion new digital asset returns on Form 1099-DA.
“If it is enforced, this rule will result in a tidal wave of new digital asset returns, overwhelming IRS resources—a truth even acknowledged by former President Biden’s own IRS officials. We are proud to work with Senator Cruz on this important effort to avoid needlessly complicating the tax-filing process,” Carey said.
Sen. Ted Cruz (R-TX) introduced companion legislation in the Senate.
“The Biden administration’s rule attempts to drive American cryptocurrency innovation overseas. This regulation undermines the purpose of DeFi technology: to enable individuals to freely buy, sell, and exchange digital assets. America’s goal should be to prioritize innovation, and this rule is the opposite. I call upon Congress to expeditiously take up this resolution, pass it, and send it to the President,” Cruz said.
The Congressional Review Act (CRA) allows Congress to disapprove of a final rule issued by a federal agency. If the rule is disapproved of using this mechanism, it is nullified. Additionally, the issuing agency is prohibited from reissuing a similar rule, unless Congress passes legislation allowing it.