The United States Internal Revenue Service (IRS) has granted an extension for public comments on the proposed crypto tax reporting rules, extending the consultation period until November 13. These rules, titled “Gross Proceeds and Basis Reporting by Brokers and Determination of Amount Realized and Basis for Digital Asset Transactions,” were made public on August 29, with the aim of streamlining tax submissions and curbing tax evasion by requiring brokers to adopt a new reporting form.
The proposed Form 1099-DA is intended to simplify the tax calculation process for taxpayers, helping them determine if they owe taxes without the need for complex calculations or the use of digital asset tax preparation services. It’s important to note that these rules are slated to take effect in 2026, impacting sales and exchanges conducted in 2025.
However, the crypto community’s response to these proposed tax rules has been largely critical. DeFi Education Fund CEO Miller Whitehouse-Levine described them as “confusing, self-refuting, and misguided.” Kristin Smith, the CEO of the Blockchain Association, emphasized the differences between the crypto ecosystem and traditional finance.
Paul Grewal, Chief Legal Officer at Coinbase, encouraged active participation from the crypto community in opposing the Treasury’s proposed regulations. He argued that if these regulations become law, they could place digital assets at a disadvantage and pose a threat to an emerging industry that is still in its early stages.
In contrast, some members of the U.S. Senate, including Elizabeth Warren and Bernie Sanders, have urged the Treasury and the IRS to expedite the implementation of crypto tax reporting requirements, criticizing the two-year delay in the process. This extension of the comment period reflects the ongoing debate and differing opinions within the United States regarding the taxation of cryptocurrencies.
