House Committee Unveils 114-Page Crypto Tax Bill for Wednesday Markup

The House Ways and Means Committee released a 114-page cryptocurrency tax bill on Monday. The document is scheduled for a committee markup on Wednesday. This release follows a hearing held in June that debated similar provisions. The legislation aims to establish clearer federal tax rules for digital assets.

Chair Jason Smith introduced the Digital Asset Tax Certainty Act. The bill consolidates several proposals previously discussed by lawmakers. It includes a $10 exception for certain fees paid in crypto. It also covers stablecoins, mining, and staking activities.

New rules for fees and stablecoins

The bill creates a de minimis exception for network fees. Taxpayers will not record a gain or loss on fees of $10 or less. This provision targets qualifying transaction costs paid in digital assets. The change is designed to reduce administrative burden for small transactions.

Provisions for U.S. dollar stablecoins address minor price deviations. The bill treats redemption value as the tax basis if acquired near the $1 peg. It also allows simplified annual accounting for widely traded assets. Both of these measures are set to begin in 2028.

Treatment of mining and staking income

Income from mining and staking is taxed as ordinary income. The bill permits certain investment trusts to stake holdings without losing their status. This differs from an earlier proposal that included an option to defer income. The new bill removes that deferral option for newly minted assets.

Wash-sale rules extend to traded digital assets. A loss is disallowed if the same asset is acquired within 30 days. This rule applies to sales before or after the loss event. The measure aligns crypto taxation with existing securities regulations.

Lending rules and disclosure program

Qualifying transfers under lending agreements are not treated as sales. This provision prevents tax events during standard lending activities. Lawmakers included these anti-abuse measures before the June hearing. The rules clarify the tax treatment of digital asset loans.

The Treasury Department must create a Voluntary Disclosure Program. This must happen within 12 months of enactment. Qualifying taxpayers can amend returns and settle owed taxes. They must also pay interest and penalties. According to GN markets/crypto (en-US), the committee has scheduled the markup for 10 a.m. ET on Wednesday.