Update on Digital Asset Tax Reporting Regulations

Digital asset transaction recordkeeping remains the responsibility of taxpayers

On April 10, 2025, President Trump signed into law H.J.Res.25, a joint resolution of disapproval to overturn the final regulations on digital asset reporting which were issued by the U.S. Treasury Department and Internal Revenue Service (IRS) on December 30, 2024. With concerns the reporting requirements would negatively impact taxpayers specifically DeFi brokers (digital trading platforms, payment processors, hosted wallet providers, as well as real estate entities that accept digital assets as payment for property transactions) and overwhelm the IRS, the Joint Resolution passed both the House and Senate with strong bipartisan support.

How does H.J. Res.25 impact taxpayers and DeFi brokers?

• DeFi brokers are no longer required to report gross proceeds from cryptocurrency sales and their customers’ personal information to the IRS on Form 1099-DA, Digital Asset Proceeds from Broker Transactions.
• Digital asset transaction recordkeeping is back in the hands of taxpayers as they will no longer receive Form 1099-DA reminding them that their digital asset transactions are taxable.
• Now that the regulation is disapproved, the IRS is prohibited from issuing the same rule or a substantially similar rule in the future without legislative action from Congress.

• Despite the absence of reporting requirements, the IRS retains the authority to audit DeFi broker activities using traditional methods.

• The repeal could open the door for DeFi brokers to develop more products.
• The joint resolution does not affect final regulations issued by the Treasury Department and IRS in July 2024 requiring information reporting for sales on or after January 1, 2025, by centralized brokers who take possession of the digital assets being sold by their customers.

Background of the Overturned Regulation (T.D. 10021)

Access our previous article, New Digital Asset Tax Reporting Regulations: What You Need to Know, for an overview of the overturned regulation, T.D. 10021.

It’s crucial for holders of cryptocurrencies and other digital assets to stay informed about these changes to ensure a smooth and compliant tax filing process. We will continue to monitor and update you on new and changing digital asset tax matters.

Questions specific to your digital asset tax obligations? Contact your Keiter Opportunity Advisor.