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The Treasury Department and the IRS have released proposed regulations that would allow digital asset brokers to furnish required transaction statements to customers solely through electronic means.
The proposed regulations (REG-105064-25), issued March 5, would establish an alternative process for brokers to obtain customer consent to receive Form 1099-DA, Digital Asset Proceeds From Broker Transactions, electronically without having to offer a paper delivery option. Under the proposal, brokers may furnish the statements by posting them to an electronically accessible location, such as a website or mobile application, with notice sent by email, or by sending the statement directly as an email attachment.
According to Treasury and the IRS, the proposal reflects the largely digital nature of digital asset trading and is intended to reduce administrative burdens associated with printing and mailing potentially lengthy transaction statements. The agencies noted that digital asset investors typically interact with brokers through online platforms and mobile devices, making electronic delivery a practical default for providing required tax reporting statements.
The proposal would also allow brokers to condition their business relationship on a customer's consent to electronic delivery of the Form 1099-DA statements and would not require brokers to provide customers with the ability to withdraw that consent and revert to paper delivery. However, brokers would still be required to obtain affirmative customer consent and meet specific disclosure and notification requirements to ensure customers are aware that their tax reporting statements will be provided electronically.
Form 1099-DA was created following enactment of the Infrastructure Investment and Jobs Act, which expanded the definition of a broker under section 6045 to include entities regularly facilitating digital asset transfers on behalf of others. Treasury and the IRS finalized regulations in 2024 requiring brokers to report gross proceeds from digital asset sales beginning with transactions occurring in 2025, with reporting obligations applying to tax filings starting in 2026.
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