The US House Ways and Means Committee is set to review the Digital Asset Tax Certainty Act on Wednesday, a bill that aims to update federal tax policies on cryptocurrency transactions, stablecoins, mining, staking, and digital asset loans.
Overview of the proposed legislation
The Digital Asset Tax Certainty Act, introduced by Committee Chairman Jason Smith, R-Mo., is a comprehensive 114-page proposal designated as H.R. 10357. Lawmakers have scheduled a committee markup for 10 a.m. Eastern time on September 16, where members will debate the bill, consider amendments, and determine whether to advance it for further consideration in the House.
The bill covers a broad range of digital asset taxation issues. It includes provisions affecting transaction fees, stablecoins, mining, staking, crypto asset lending, and trading activities.
A key feature of the bill is the introduction of a “de minimis” exemption for network or transaction fees of $10 or less, relieving taxpayers from reporting gains or losses on these minor transactions. This exemption addresses concerns about the burdensome process of tracking tax obligations created by small fees paid in digital assets.
Paying small blockchain transaction fees with crypto can trigger taxable events under current IRS rules, as digital assets are classified as property. The de minimis exemption would simplify compliance for everyday users by excluding qualifying minor fees from capital-gains calculations.
Another significant aspect is the treatment of stablecoins. The act proposes to use the redemption value of eligible dollar-pegged stablecoins as the tax basis when purchased at or near that value.
For those involved in mining and staking, the bill seeks to classify rewards from these activities as ordinary income, impacting how these earnings are reported and taxed. Investment trusts that participate in staking could maintain their tax status under certain conditions.
Mini dictionary: House Ways and Means Committee, the chief tax-writing committee of the US House of Representatives, oversees all taxation, tariffs, and revenue-raising measures.
Other tax provisions and legislative process
The act also proposes to extend federal wash-sale rules to digital assets, aiming to curb tax-loss harvesting strategies that are currently unregulated in crypto markets. Under the bill, qualifying crypto loans would not be treated as taxable sales. In addition, it requires the Treasury Department to create a program through which eligible taxpayers could amend prior returns to address unpaid taxes, interest, and penalties related to digital asset activities.
Industry groups had previously supported an alternative proposal that would have allowed income from certain newly created mining and staking rewards to be recognized later, but the current version of H.R. 10357 does not include such a provision.
If the Digital Asset Tax Certainty Act advances through the committee, it must secure approval from the full House, then the Senate, and finally the President, before becoming law.
| Provision | Current Treatment | Proposed Change in H.R. 10357 |
|---|---|---|
| Small transaction fees | Taxable as property | Exempt if $10 or less |
| Stablecoins (basis) | Market price | Redemption value when bought at par |
| Mining/Staking rewards | Varies | Taxed as ordinary income |
| Wash sales | Applies to securities only | Extends to digital assets |
| Crypto lending | Often treated as sale | Exemption for qualifying loans |
Lawmakers previously examined similar small-transaction exemptions and six other digital asset tax proposals during a June hearing dedicated to crypto-related taxation. The current bill incorporates some of these concepts, seeking to clarify and streamline how taxpayers and companies report digital asset activities to the Internal Revenue Service.
The bill’s supporters aim to simplify tax laws for crypto users and provide clear guidance for stablecoins, miners, stakers, and those involved in asset lending, while critics note that some provisions from earlier drafts have been omitted.
