$50B Crypto Tax Loophole: Elizabeth Warren Urges Action

• U.S. Senators led by Elizabeth Warren have urged the Treasury Secretary and IRS Commissioner to swiftly implement new tax regulations that require digital asset brokers to report crypto income, as mandated by the Infrastructure Investment and Jobs Act (IIJA).
• The IIJA was passed almost two years ago with the intention of addressing the estimated $50 billion in lost crypto taxes due to inadequate reporting practices.
• The Senators’ letter highlights how failure to implement these rules by the January 1, 2024 deadline will result in billions of dollars in lost tax revenue for the US government.

Senators Urge Swift Action on Crypto Tax Regulations

U.S. Senators led by Elizabeth Warren have written a letter addressed to Treasury Secretary Janet Yellen and IRS Commissioner Daniel Werfel, urging prompt action on implementing new tax reporting requirements for digital asset brokers. The letter references a bipartisan measure passed nearly two years ago known as the Infrastructure Investment and Jobs Act (IIJA), which was enacted with the intent of closing a $50 billion “crypto tax gap” caused by inadequate reporting practices.

Infrastructure Investment and Jobs Act

The Infrastructure Investment and Jobs Act (IIJA) is a bipartisan measure that requires improved reporting practices in order to ensure taxpayers are accurately reporting their crypto income when filing taxes. Congress directed Treasury and IRS to finalize new implementing rules by January 1, 2024 – however, nearly two years since its passage, no such regulations have been implemented yet. The senators’ urgent call for safeguarding billions in potential tax revenue hinges upon immediate implementation of these rules before this deadline passes.

Consequences of Failure To Implement Rules

Should these rules fail to be implemented before January 1st next year, it would result in billions of dollars being lost from American taxpayers who are not aware or adequately equipped for filing their taxes correctly when it comes to cryptocurrencies like Bitcoin, Ethereum, etc.. This would be a major blow to national revenue considering current economic conditions due to COVID-19 relief efforts across America being put into motion this year.

Warren’s Letter To Yellen And Werfel

In her letter addressed to Yellen and Werfel, Senator Warren wrote: “We urge you both [Yellen & Werfel]…to take all necessary measures now — including issuing proposed rules if needed — so that investors can comply with the law beginning on Jan 1, 2022” She further added: “Your prompt attention is essential; failure could cost taxpayers billions of dollars.“


In conclusion: swift action is required from Treasury Secretary Janet Yellen & IRS Commissioner Daniel Werfel if they want to avoid losing millions in potential future tax revenues from crypto investors who are unaware or inadequately equipped when it comes to filing taxes correctly concerning digital assets such as Bitcoin or Ethereum