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January 5, 2023

IRS pushes back new broker reporting requirements for digital assets until final regulations are released

The IRS has relieved (Announcement 2023-2 (December 23, 2022)) brokers from complying with the new information reporting (Form 1099) requirements for digital assets like cryptocurrencies until the Treasury and IRS issue final regulations implementing the requirements.


IRC Section 6045 requires brokers to report the sale of certain securities, derivative contracts, commodities and similar assets. IRC Section 6045A requires them to report transfers of securities. For "covered securities," brokers must report the customer's basis and holding period on both Forms 1099 and broker transfer statements.

The Infrastructure Investment and Jobs Act (IIJA), signed into law in November 2021 (see Tax Alert 2021-1538), created a new asset category for purposes of IRC Section 6045 reporting called "digital assets." The IIJA defined digital assets as "any digital representation of value which is recorded on a cryptographically secured distributed ledger or any similar technology as specified by the Secretary." The IIJA also expanded the definition of broker to include "any person who (for consideration) is responsible for regularly providing any services effectuating transfers of digital assets of behalf of another person."

Other IIJA amendments to IRC Sections 6045 and 6045A require brokers to:

  1. Report sales of digital assets occurring on or after January 1, 2023, with the first payee statements due February 15, 2024
  2. Report the cost basis and holding period for digital assets acquired on or after January 1, 2023, as covered securities
  3. Issue transfer statements after December 31, 2023, for transfers to other brokers

The requirements apply to any transfer made on or after January 1, 2023, to a non-broker.

Delaying implementation of reporting requirements

Announcement 2023-2 relieves brokers from complying with the new reporting requirements for digital assets until the Treasury Department and IRS issue final regulations implementing the IIJA's amendments.

EY observes: According to press reports, the IRS has been using "John Doe" summonses to obtain information about thousands of customers at once from US digital asset exchanges. These summonses can be complicated and difficult to comply with. Therefore, some exchanges may want to file Forms 1099 to avoid the John-Doe-summons process and provide information to customers who might have a substantive tax liability from their digital asset sales. Certain transactions, such as those that pay an interest-like "yield" to a customer or counterparty, likely require Form 1099 reporting under the existing rules and regulations; Announcement 2023-2 does not alter those reporting requirements.

While US requirements are still unclear, the Organisation for Economic Co-operation and Development is proceeding with the Crypto-Asset Reporting Framework (CARF), which should be effective in the European Union on January 1, 2026, and could be adopted by non-EU countries as early as January 1, 2024. CARF will also bring changes to the Common Reporting Standard. Groups that are engaged in digital-asset-related businesses should use the time to evaluate each of the entities in their groups, and each of the products and services they offer, to determine how the various tax reporting regimes will affect them in the future.


Contact Information
For additional information concerning this Alert, please contact:
Financial Services Office
   • Tara Ferris (
   • Jonathan Jackel (
   • Justin O'Brien (
   • Deborah Pflieger (
   • Thomas Shea (

Published by NTD’s Tax Technical Knowledge Services group; Andrea Ben-Yosef, legal editor