The Blockchain Association criticized the IRS’s proposed broker rule on June 21, 2024, stating it violates the Paperwork Reduction Act (PRA). The rule could result in over 8 billion forms, imposing significant burdens on brokers.
Historically, the PRA aims to minimize public burdens regarding information acquisition from federal agencies. The IRS’s estimation of 30 minutes per form translates to 4 billion burden hours, costing over $254 billion, far exceeding the potential $10 billion tax revenue.
This significant disparity highlights the impracticality of the rule. Marisa Tashman Coppel emphasized that the IRS underestimated the time and cost constraints for brokers. Jake Chervinsky and Perianne Boring provided differing insights, with Chervinsky opposing the rule and Boring supporting the IRS’s efforts to extend regulatory scope and compliance.
The strategic importance lies in balancing regulatory compliance with practical feasibility to avoid excessive financial and operational burdens on brokers.
