Oct. 17, 2023
To whom it may concern, I am writing to express my deep concerns regarding the proposed regulations outlined in the PDF document titled "Gross Proceeds and Basis Reporting by Brokers and Determination of Amount Realized and Basis for Digital Asset Transactions" from the Internal Revenue Service (IRS) and the Treasury Department. After analyzing the document and its key points, I believe it is essential to address two specific areas of concern: the impact abroad and the effect on small businesses. Firstly, the proposed regulations fail to adequately limit reporting requirements for protocols operated outside the United States and for users residing outside the United States. This lack of restriction raises significant issues surrounding privacy and international cooperation. It is crucial to acknowledge the global nature of digital assets and the protocols that operate within this space. By imposing reporting obligations without clear international boundaries, these regulations risk infringing on the rights and privacy of individuals who operate in jurisdictions outside the United States. A more considered approach would be to establish clear guidelines that respect the diverse legal frameworks and digital asset ecosystems across different countries. Secondly, the proposed reporting requirements will disproportionately impact small businesses and startup protocols. These entities often do not possess the resources or infrastructure to fulfill the extensive tracking and reporting obligations outlined in the document. The additional expenses required to implement these tracking systems have the potential to hinder their growth and innovation. It is essential to understand that these entrepreneurial ventures are the lifeblood of the digital asset space, driving pioneering technological developments and fostering competition. Imposing burdensome reporting requirements on these smaller players could stifle their creativity and hamper their ability to compete with larger, better-resourced corporations. A more balanced approach, considering the unique challenges faced by small businesses, is necessary to promote a thriving and diverse digital asset ecosystem. In conclusion, I implore the IRS and the Treasury Department to reconsider the proposed regulations outlined in the aforementioned document. It is crucial to carefully balance reporting requirements with privacy rights and international cooperation. Moreover, it is essential to take into account the impact on small businesses and start-up protocols, as excessive reporting burdens could hinder their growth and undermine innovation within the digital asset industry. Thank you for considering my comments. I trust that you will seriously evaluate the voices of stakeholders and strive for solutions that foster both compliance and fair treatment within the ever-evolving digital asset space. Sincerely, Lola Heart