Compliance Briefing — November 15, 2021

Executive briefing: The Infrastructure Investment and Jobs Act (Pub. L. 117-58) signed on 15 November 2021 amends Internal Revenue Code Sections 6045, 6045A, and 6050I. Digital asset platforms, custodians, and certain decentralized service providers now fall under the definition of “broker” and must report customer transfers and cost basis data for transactions occurring after 31 December 2023.

Key compliance checkpoints

Broker scope assessment. Determine whether exchange, custodial, or hosted wallet activities meet the statute’s “effectuating transfers” standard.
Tax reporting data. Capture customer identity, transaction proceeds, cost basis, and transfer destinations needed to populate Form 1099-B and transfer statements.
Section 6050I obligations. Prepare to treat digital assets like cash for $10,000+ receipt reporting, including Know Your Customer controls for counterparties.

Operational priorities

System upgrades. Enhance ledgers and data warehouses to track lot-level basis, holding periods, and wallet movements across on-chain and off-chain environments.
Policy updates. Revise terms of service, privacy notices, and compliance manuals to cover new IRS reporting and customer notification duties.
Regulatory monitoring. Follow Treasury and IRS rulemaking (REG-122793-19) and phased implementation timelines while maintaining readiness for initial reporting years.

Enablement moves

Establish cross-functional steering groups spanning tax, compliance, product, and engineering to coordinate implementation.
Integrate blockchain analytics to reconcile wallet addresses with customer identities and detect self-hosted transfers.
Develop customer outreach programs explaining forthcoming tax forms and data collection requirements.

Sources

Zeph Tech guides digital asset platforms through broker determinations, tax data architecture, and regulatory engagement to meet the IIJA reporting mandate.