House committee releases sweeping crypto tax bill ahead of Wednesday markup

The House Ways and Means Committee released a sweeping cryptocurrency tax bill on Monday ahead of a markup scheduled for Wednesday, advancing an effort to establish clearer federal tax rules for digital assets.

The Digital Asset Tax Certainty Act, introduced by committee Chair Jason Smith, R-Mo., brings together several proposals that lawmakers previously debated at a committee hearing in June.

Among the provisions is a de minimis exception for certain fees paid in crypto. Someone paying a qualifying network or transaction fee in crypto would not have to record a gain or loss if the fee is $10 or less.

The bill also addresses small deviations from the $1 peg for qualifying U.S. dollar stablecoins, generally treating their redemption value as the tax basis if acquired close enough to that value.

Taxpayers could also opt for simplified annual accounting for widely traded digital assets. Both the fee provision and accounting change would start in 2028.

Mining, staking and wash sales

Mining and staking have their own section in the proposed bill. Income from such activity would generally be taxed as ordinary income. However, the bill also makes room for certain investment trusts to stake their holdings without that activity alone affecting their tax status.

An earlier mining and staking bill included an option to defer income from certain newly minted digital assets. That option is not in this new bill. Crypto industry groups had pushed for the earlier bill to pass unchanged.

Wash-sale rules would also be extended to traded digital assets. A loss could be disallowed if someone sells an asset and acquires the same or a substantially identical one within 30 days before or after the sale.

Qualifying transfers of traded digital assets under lending agreements would not be treated as sales or exchanges. Lawmakers introduced the lending and anti-abuse measures ahead of the June hearing.

The legislation would also require the Treasury Department to establish a Digital Asset Voluntary Disclosure Program within 12 months of enactment. Taxpayers who qualify could amend earlier returns and settle the tax, interest, and any penalties owed.

The committee has the bill scheduled for its Wednesday markup at 10 a.m. ET.