The Department of the Treasury and the Internal Revenue Service (IRS) of the United States have produced a set of cryptocurrency regulations proposal outlining brokers' reporting obligations.

The U.S. Small Business Administration's Office of Advocacy reported that the proposal for crypto regulations for brokers was released on August 29. It went on to say:

“The proposed rules would require digital asset brokers, including trading platforms, payment processors, and certain hosted wallet providers, to report gross proceeds for all sales or exchanges of digital assets starting on January 1, 2025.”

Brokers, also known as "digital asset middlemen" in the legislative plan, will be required to provide information on gains and losses incurred during the sale of crypto assets. This provision, however, will take effect on or after January 1, 2026.

According to a related document published in the Federal Register, the proposed regulations are likely to result in "higher levels of taxpayer compliance" as the IRS gains greater clarity about taxpayer income.

The Treasury Department and the IRS have encouraged small businesses in the United States to offer their perspectives on how the regulations would affect them, which will be accompanied by a public hearing on November 7, 2023.

Once signed into law, all brokers in the United States will be required to file information returns with the IRS using the new Form 1099-DA and provide payee statements to customers.

Sources:

https://cointelegraph.com/news/us-treasury-irs-cryptocurrency-regulation-brokers

https://advocacy.sba.gov/2023/09/05/treasury-releases-proposed-cryptocurrency-regulations-for-brokers/

https://www.federalregister.gov/documents/2023/08/29/2023-17565/gross-proceeds-and-basis-reporting-by-brokers-and-determination-of-amount-realized-and-basis-for