Crypto Tax Bill Set for Markup in House Ways and Means Committee

The US House Ways and Means Committee will review tax rules for crypto assets on September 16. The main points of focus are proposals to defer taxation on tokens earned through mining and staking until they are sold, and extending wash sale rules to digital assets.

A central bill is the 'Mining and Staking Tax Clarity Act (H.R.9175),' introduced by Republican Representative Mike Carey on June 8. This bill would give miners and stakers the option to defer recognition of income on newly generated tokens until they are sold, rather than being treated as capital gains.

The proposed legislation would mark a significant departure from the default position established by the IRS in Revenue Ruling 2023-14, which states that cash-basis taxpayers must include the fair market value of staking rewards in gross income in the year they gain dominion and control. If enacted, the bill would ease cash flow burdens for US miners and stakers.