Sponsors (4)
The bill brings important clarity and election options for taxing various digital-asset activities—reducing uncertainty for many small users and market participants—but does so while delegating major details to Treasury, creating transitional compliance burdens, temporary rules that expire in 2035, and the risk of earlier or higher tax liabilities for some actors.
Most taxpayers and crypto market participants get clearer, statutory definitions of 'digital asset', 'tokenized property', and 'actively traded digital asset', reducing ambiguity about which tax rules apply.
Everyday crypto users making small purchases can exclude up to $300 of gain (and losses up to $300) per transaction, with an annual $5,000 cap, reducing taxable events and recordkeeping for routine spending.
Lenders and platforms that lend specified assets (including some digital-asset lending) get clearer rules requiring recognition of accrued lending income and basis adjustments on return, reducing ambiguity about taxation of lending arrangements.
Nearly all affected taxpayers and industry actors face significant regulatory uncertainty because the Secretary/Treasury is given broad rulemaking authority and the bill repeatedly requires IRS/Treasury regulations to implement key details.
Many substantive provisions are temporary (sunset/repeal around Dec 31, 2035), creating long‑term uncertainty for businesses, investors, charities, and taxpayers planning beyond that date.
Some taxpayers, lenders, and platforms will face higher or earlier tax liabilities—e.g., immediate recognition of accrued lending income and mark‑to‑market treatment can produce taxable income without corresponding cash, increasing cash‑flow burdens.
Based on analysis of 7 sections of legislative text.
Creates a comprehensive tax framework for digital assets: definitions, a $300 de minimis retail exclusion, wash-sale and lending rules, MTM elections, validator deferral, and charitable treatment; many rules expire 2035.
Official title: Amend the Internal Revenue Code of 1986 to reform the treatment of digital assets.
Introduced June 30, 2025 by Cynthia M. Lummis · Last progress June 30, 2025
Creates a new, detailed tax framework for digital assets (like cryptocurrencies and tokenized property). It adds statutory definitions, a small-dollar exclusion for personal crypto purchases, special rules for lending, wash-sales, mark-to-market elections for traders/dealers, income-deferral for validators (mining/staking), and a charitable contribution category for appreciated digital assets; many rules are temporary and expire at the end of 2035.