US House Overturns IRS DeFi Broker Rule

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The US House of Representatives has voted to overturn an IRS rule that would classify crypto entities, including decentralized finance (DeFi) platforms, as brokers required to collect specific taxpayer and transaction information.

The bipartisan vote of 292-132 aligns with the US Senate’s decision to advance a resolution under the Congressional Review Act to nullify the rule, which was finalized during the last days of President Joe Biden’s administration.

Missouri Republican Jason Smith, advocating for the resolution, warned that the IRS rule could harm US businesses and stifle innovation. “There are genuine concerns about whether the rule can even be implemented,” he stated.

“DeFi exchanges are different from centralized crypto exchanges or traditional banks and brokers. DeFi platforms lack the capability to collect the necessary user information to enforce this rule.”