IRS Proposes Electronic-Only Tax Reporting for Crypto Brokers

IRS Proposes Electronic-Only Tax Reporting for Crypto Brokers



IRS Proposes Electronic-Only Tax Reporting for Crypto Brokers



The US Internal Revenue Service (IRS) has proposed a rule that would allow digital-asset brokers to provide tax statements exclusively in an electronic format.

The proposal, published as a notice of proposed rulemaking in the Federal Register, would amend regulations under section 6045 of the Internal Revenue Code. These rules govern how brokers must report digital-asset transactions to the authorities. Under the change, brokers reporting crypto trades using Form 1099-DA would be permitted to obtain customer consent for electronic statements without offering a paper delivery alternative.

Operational costs and high-frequency trading

The IRS stated that the measure is intended to reduce compliance burdens as digital-asset trading expands and investors generate a large number of transactions each year.

“Transactions involving digital assets are almost exclusively conducted electronically,” the Treasury Department and IRS noted in the proposal. The agencies added that sending paper statements could impose significant costs on brokers, particularly because some customers execute hundreds or even thousands of trades annually.

Under the proposal, brokers could obtain positive consent from customers to receive tax statements electronically through explicit actions. These include checking a box or clicking a button. If a customer declines to consent, the broker may choose to limit services or terminate the relationship. This provision allows platforms to avoid potential penalties for failing to furnish required statements by simply ending the business connection.

The proposal represents the latest move by US authorities to clarify the tax treatment of digital assets. In November 2025, the IRS issued Revenue Procedure 2025-31. This guidance created a safe harbor allowing certain crypto exchange-traded products (ETPs) to stake proof-of-stake tokens without losing their pass-through tax treatment.

Comments on the proposed rule will be accepted for 60 days following its publication in the Federal Register.

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