- The House Ways and Means Committee advanced a crypto tax bill in a 38-5 vote.
- The bill would introduce new tax rules for digital assets, including mining, staking and crypto transactions.
- It would also extend wash-sale restrictions that currently apply to stocks to digital assets.
- Industry figures have raised concerns about the bill’s treatment of newly created crypto rewards and its impact on traders.
Unlike the CLARITY Act, where ethics concerns prevented the bill from advancing, the US has made some progress when it comes to crypto tax legislation. The House Ways and Means Committee has voted 38-5 to advance the bill, sending it to the House.
The committee’s chair, Jason Smith (R-Mo.), called the vote a “historic moment”, adding that after a year of cooperation, Democrats and Republicans “have come together to establish the first-ever tax framework for digital assets”.
According to The Wall Street Journal, the proposal would exempt small transaction fees tied to digital asset sales from taxation and make it simpler to use crypto and stablecoins for everyday purchases. It would also classify mining and staking income as ordinary income rather than the more favourably taxed capital gains, though it leaves open when that income should be recognised for tax purposes.
The bill would also extend the same anti-wash-sale restrictions that apply to stocks to digital assets, limiting a taxpayer’s ability to claim a loss if they quickly repurchase a substantially similar asset.
Read also: Senate Crypto Bill Stalls as Warren Calls for Tougher Safeguards Ahead of Midterms
Industry Pushes Back
Not everyone in the industry agrees with the bill. Crypto tax service CryptoTaxSucks said the bill would “screw over every onchain trader”, particularly criticising the wash-sale rule.
Jason Somensatto, director of policy at Coin Center, wrote in a blog post that while he supports much of the bill, including provisions such as continued progress towards a simplified accounting method that would ease the burden on everyday users, he wants the block-reward language either removed or rewritten.
He argues that the bill shouldn’t implicitly settle a legal question that is still being litigated. Instead, he says, it should remain neutral, as he believes was originally intended.
If this language becomes law, it could be seen as congressional endorsement of the IRS’s mistaken position that newly created rewards are income.
Jason Somensatto, director of policy at Coin Center Read also: BIS Finds Bitcoin Transfer Estimates Can Vary Sixfold Depending on Measurement Method
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