Sponsor
Theodore Paul Budd
Senator · R-NC
The bill eases compliance and protects casual crypto users from taxation on very small transactions, at the cost of narrowing the tax base (leaving many crypto disposals taxable) and creating aggregation and revenue trade-offs for active traders and the government.
Casual or small-scale virtual-currency users no longer must report gains or losses from individual dispositions of $200 or less, reducing filing complexity and administrative burden for everyday taxpayers who make occasional crypto transactions.
A clear statutory definition of 'virtual currency' reduces uncertainty about which digital assets qualify for the de minimis exclusion, making compliance and enforcement easier for taxpayers, financial institutions, and the IRS.
Automatic inflation adjustments to the $200 threshold after 2027 help preserve the exclusion's real value over time, preventing gradual erosion of the benefit for small transactions.
Frequent or active crypto traders may lose the intended benefit because multiple small trades can be aggregated and push total dispositions above the $200 threshold, increasing their tax liability and reporting burden.
The exclusion explicitly does not apply to sales for cash or to dispositions of income-producing or business-use property, so many crypto transactions (including business receipts and earned crypto) remain taxable and reportable.
By exempting small crypto dispositions from taxation, the bill reduces potential federal tax revenue modestly, which could marginally increase deficits or shift tax burdens elsewhere.
Based on analysis of 2 sections of legislative text.
Excludes de minimis personal virtual-currency gains or losses (up to $200 value or $200 gain/loss, aggregated) from gross income, with exceptions for cash-equivalent and business transactions.
Senator · R-NC
Excludes small, routine virtual currency gains or losses from a taxpayer's gross income, so very small crypto trades won't trigger taxable events. The exclusion applies only to personal transactions under a de minimis $200 threshold (value or gain/loss), aggregates related transactions, excludes business or cash-equivalent sales, and becomes effective for transactions after December 31, 2026, with the threshold indexed for inflation after 2027.
Official title: Amend the Internal Revenue Code of 1986 to exclude from gross income de minimis gains or losses from certain sales or exchanges of virtual currency, and for other purposes.
Introduced March 24, 2026 by Theodore Paul Budd · Last progress March 24, 2026