Representatives Patrick McHenry (NC-10) and Tim Ryan (OH-13) have today introduced the Keep Innovation in America Act, a bipartisan bill seeking to fix the “digital asset” reporting requirements in the infrastructure bill turned into law this week.
“We have to figure out how to balance consumer protections and reasonable oversight while simultaneously providing these technologies and companies with the necessary space they need to grow, innovate and democratize the financial sector,” Rep. Ryan said in a statement. “I’m committed to finding that balance, and I believe the McHenry-Ryan legislation is the best path to get us there.”
In September, a tax change introduced in the infrastructure bill would require U.S. persons receiving over $10,000 in bitcoin and cryptocurrency to report the sender’s personal information to the Internal Revenue Service (IRS), extending the provisions of section 6050I that currently only apply to cash transactions. The new bill aims to remove these reporting requirements entirely.
“The Infrastructure Investment and Jobs Act that President Biden signed into law on Monday…includes digital asset reporting requirements that threaten to push innovators and entrepreneurs overseas,” Rep. McHenry said in the same statement. “We can fix these poorly constructed standards and ensure they are compatible with how this new technology actually works. The Keep Innovation in America Act will address these issues and provide additional clarity on the scope of these requirements.”
The new bill also instructs the Treasury Department to “conduct a study on the effect of expanding the definition of cash…to include any digital asset” for purposes of section 6050I, and excludes miners, developers, and individual users from the definition of “brokers” — who would have to also report information on transactions.
According to the statement, the bill is co-sponsored by ten other representatives and supported by the Electronic Frontier Foundation, the National Taxpayers Union, and the Americans for Tax Reform.
A bipartisan team of U.S. senators is also seeking to restrict these reporting requirements of cryptocurrency transactions, albeit with not as a comprehensive bill. Chairman of the Senate Finance Committee, Ron Wyden, and Senator Cynthia Lummis joined forces to clarify to whom such provisions should apply, protecting innovators such as miners and developers in the country. Their bill reportedly includes a provision that would make it retroactive to the infrastructure bill’s signing.