a16z has commented on the draft form 1099-DA from the Internal Revenue Service (IRS) in the United States. Their comments and opinions are outlined as follows:
– Requiring multiple brokers to submit 1099-DA forms for each digital asset transaction results in unnecessary duplication of information reporting, creating unreasonable burdens for filers.
– The requirement for brokers to report wallet addresses is unnecessary and puts sensitive taxpayer information at significant risk.
– The cost of providing the information required by the 1099-DA form is too high, and in some cases, even impossible.
– The final regulations should postpone or “phase in” the effective date of digital asset information reporting requirements.
– Non-custodial wallets and digital asset payment processors should be removed from the “broker” category listed on the 1099-DA form.
– The IRS should not require the submission of 1099-DA forms when disposing of fiat-backed stablecoins and most disposals of non-exchangeable tokens.
– The requirement to submit 1099-DA forms should include a minimum threshold, allowing brokers to aggregate transactions for reporting purposes.
Source Link: https://api.a16zcrypto.com/wp-content/uploads/2024/06/Andreessen-Horowitz-a16z…
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