US Crypto Tax Bill Advances With Bipartisan Support, Staking Questions Linger

A US crypto tax bill has advanced from the House Ways and Means Committee with significant support from both parties. The Digital Asset Tax Certainty Act, H.R. 10357, was voted on by lawmakers who chose to send it to the full House with a 38-5 margin.

The draft legislation aims to amend various tax rules that currently apply to stocks and other investments to also apply to digital assets. This includes prohibiting investors from selling at a loss and quickly buying back the same asset to reduce their tax bills, known as wash-sale restrictions for crypto.

The bill also reduces some accounting options, creates rules for crypto-lending, and makes it easier to value digital asset donations. Furthermore, it will allow the use of cryptos without calculating a gain or loss to pay network or transaction fees of up to $10, removing the paperwork generated by small fees attached to blockchain transactions.

However, one major question remains unanswered: how to determine when staking and mining rewards become taxable. The bill treats income earned from validating crypto transactions as ordinary income but does not decide when that income must be recognized. This matters because a crypto holder may receive rewards from cryptos without selling or converting them into dollars later on.