The US Treasury Department reiterates that the Internal Revenue Service would not consider cryptocurrency miners, stakers, or developers to be brokers

The Treasury said in a letter to a group of senators that it does not intend to regard miners and stakers as brokers for tax reporting reasons. The problem stems from the fact that the Infrastructure Bill delegated such authority to the Treasury.

The Treasury informed six worried senators in a February 11 letter obtained by The Block that it had no plans to tax crypto miners, stakers, and wallet providers as brokers.

“Present laws impose broker reporting responsibilities solely on market participants who participate in commercial operations that provide them access to information about taxpayers’ securities transactions,” the letter states.

Brokers are required by the Internal Revenue Service (IRS) to maintain records on the businesses with whom they interact. The problem arose in cryptocurrency as a consequence of a new reporting regulation enacted as part of last year’s Infrastructure Bill.

According to the regulation, any service provider engaged in assisting transactions involving digital assets qualifies as a broker. This became a key issue of contention during the Senate’s discussion over the infrastructure plan.

Cynthia Lummis, Mark R. Warner, Rob Portman, Kyrsten Sinema, Pat Toomey, and Mike Crapo were among the senators who received the letter. The six were instrumental in attempts to alter the crypto reporting language in response to privacy concerns and the technical difficulty of a crypto miner maintaining information on every participant and transaction they approve.

Treasury seems to concur with the senators’ positions, stating that: “They are consistent with the Treasury Department’s position that ancillary parties who are unable to get information beneficial to the IRS are not intended to be included by the broker reporting requirements. For instance, individuals verifying transactions through a consensus process are unlikely to understand whether a transaction is part of a sale. And those who are only engaged in the sale of storage devices used to store private keys or in the writing of software code are not engaged in broker activities.”

This letter, however, is a step away from official advice, which will almost certainly need multiple rounds of suggestions, public debate, and amendments before a definitive tax reporting policy is formalised.

Meanwhile, crypto taxes continue to be a famously hazy topic, with the majority of legislation addressing the issue failing to get out of committee.

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