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The Coin Center has filed a lawsuit against the U.S. Treasury over an ‘unconstitutional’ tax reporting rule

Last year’s infrastructure bill included the requirement, which sparked debate in the sector over a separate broker rule.

AUSTIN, Texas (KTRK) — On Friday, the cryptocurrency think tank Coin Center filed a complaint against the U.S. Treasury Department and the Internal Revenue Service, arguing that a crypto tax reporting requirement was included in last year’s infrastructure bill is “unconstitutional.”

The law, which goes into force in 2024, requires U.S. taxpayers who receive more than $10,000 in bitcoin to record the sender’s Social Security number and other personal information.

This was one of the numerous provisions added in last year’s infrastructure law, including a contentious crypto tax reporting requirement for brokers. Although the provision was eventually unsuccessful, it sparked a significant industry outcry.

According to the lawsuit, the reporting mandate would force cryptocurrency users to exchange personal information with each other and with the federal government. Ordinary bitcoin senders and receivers would be required to provide their names, Social Security numbers, home addresses, and other personally identifying information under the conditions of the regulation.

According to the lawsuit, Coin Center is concerned that the rule would oblige Americans to preserve sender information for up to a year if a group of transactions is deemed “related” if the total exceeds $10,000.
The action names both Treasury Secretary Janet Yellen and IRS Director Charles Rettig as defendants.

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