Congress kills IRS crypto reporting rule, shielding traders from tax scrutiny
S.J.Res. 3 — A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Internal Revenue Service relating to "Gross Proceeds Reporting by Brokers That Regularly Provide Services Effectuating Digital Asset Sales". · Filed by Ted Cruz (R-TX) · 14 cosponsors · Introduced Jan 21, 2025 · Passed chamber
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What it does
This resolution kills an IRS rule requiring cryptocurrency brokers to report the gross proceeds of digital asset sales to the tax agency. The rule was designed to improve tax compliance by giving the IRS visibility into crypto transactions. By disapproving it, Congress prevents brokers from having to file these reports, making it harder for the IRS to track and tax crypto income.
Why we flagged it
The bill's sole function is to block an IRS reporting requirement for cryptocurrency brokers. It is a Congressional Review Act disapproval resolution that removes a tax-administration mechanism without replacing it, effectively narrowing the IRS's enforcement reach on a specific asset class.
What the text implies
- Crypto investors gain a compliance advantage over other asset classes (stocks, bonds, real estate) where brokers already report proceeds to the IRS, creating unequal tax-enforcement pressure across income types.
- The IRS will have reduced ability to cross-reference broker reports with individual tax returns for crypto transactions, lowering detection of underreported gains and incentivizing non-compliance.
- Brokers are relieved of a reporting burden, but the cost is borne by the broader tax base through either lower revenue or higher rates on other income sources.
Section numbers refer to the bill text the analysis read — linked under Primary records below.
Who it affects
Ordinary taxpayers lose tax enforcement visibility on a major income source. Crypto investors who fail to report gains face lower audit risk; non-crypto taxpayers bear a larger share of the tax burden to compensate. The rule was a compliance mechanism, not a new tax — killing it reduces government's ability to enforce existing tax law fairly across income types.
Who stands to gain
- cryptocurrency brokers and exchanges
- crypto investors and traders
- digital asset trading platforms
Named in the bill
Internal Revenue Service (IRS), U.S. Senate, 119th Congress, Senate Committee on Finance, cryptocurrency brokers, digital asset exchanges
Where it stands
14 cosponsors: 14 Republicans.
- Jan 21, 2025 — Introduced · Congress.gov: “Introduced in Senate”
- Jan 21, 2025 — Referred to Senate Committee on Finance · Congress.gov: “Read twice and referred to the Committee on Finance”
- Feb 12, 2025 — Reported out of committee · Congress.gov: “Senate Committee on Finance discharged, by petition, pursuant to 5 U.S.C. 802(c)”
- Mar 4, 2025 — Passed the Senate · Congress.gov: “Passed Senate without amendment by Yea-Nay Vote. 70 - 27. Record Vote Number: 102. (text: CR S1488)”
Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.
Money around this bill
1 lobbying clients named this bill on 1 disclosure filings across 1 quarter, Jun 2026 to Jun 2026. Those filings disclosed $410,000 in lobbying spend. A filing names 17 bills on average, so that figure is what each filing reported, not a share belonging to this bill.
More lobbying clients named this bill than 0% of bills with at least one filing.
Ted Cruz, the sponsor, reported $531,115 in PAC receipts in the 2026 cycle.
- Digital Currency Group — $410,000 on 1 filing
Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.
How this was measured
Analysis — Quorum's AI read the bill text published by Congress.gov (1,102 characters) on Mar 14, 2026. Section numbers in the findings refer to that text, linked below; transparency and hidden-provision scores are compared against the median of 16,222 analysed bills.
Status and sponsors — Congress.gov's bill record — actions, committee referrals and cosponsors — loaded nightly. The timeline shows status changes, not every procedural action.
Money — Senate Lobbying Disclosure Act filings whose specific-issue field names this bill for quarters ending Jun 2026 to Jun 2026. A filing's amount is reported whole beside the median number of bills a filing names; it is never divided across them. PAC receipts are FEC-reported contributions to the sponsor's candidate committee in the 2026 cycle.
As of — lobbying records through Jul 20, 2026 · page rendered 2026-10-20.
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