The IRS definition of “broker” in its proposed regulations for digital asset reporting under Sec. 6045 (REG-122793-19) stretches the statutory definition “beyond the breaking point” and adds to security and privacy concerns, crypto industry advocates told the IRS in a public hearing.
The proposed regulations clarify that the definition of broker for purposes of Sec. 6045 includes digital asset trading platforms, digital asset payment processors, certain digitally hosted wallet providers, and persons who regularly offer to redeem digital assets created or issued by that person.
Thirteen speakers shared their concerns with IRS and Treasury officials for 90 minutes during a telephone hearing this week. In addition, the proposed regulations drew almost 125,000 comments. The speakers expressed privacy concerns, saying the broad definition may mean too many people will receive too much personal information from the user. Read more.