US Lawmakers Push Crypto Tax Relief: Small Stablecoin Payments & Staking Rewards in Focus
- The Digital Asset PARITY Act introduces a $200 capital gains tax exemption for purchases made with regulated US dollar stablecoins starting after 2025.
- Taxpayers could choose to defer income taxes on crypto staking and mining rewards for up to five years to avoid being taxed on immediate receipt.
- The bill applies traditional financial regulations such as wash sale rules and mark-to-market accounting to digital assets while easing appraisal requirements for large donations.
Two House lawmakers have put out a draft crypto tax bill that targets two issues regarding small stablecoin payments and how staking rewards are taxed.
The draft, called the Digital Asset PARITY Act, comes from Rep. Max Miller (R-Ohio) and Rep. Steven Horsford (D-Nev.). It would create a US$200 (AU$306) capital gains tax exemption for purchases made with certain regulated, US dollar stablecoins. It would not apply to other cryptocurrencies, and it would not cover brokers or dealers.
To qualify, a stablecoin would need to be issued by a permitted issuer under the GENIUS Act, be pegged only to the US dollar, and have traded within 1% of US$1.00 (AU$1.53) on at least 95% of trading days over the prior 12 months.
Moreover, the draft says lawmakers are considering an annual cap to prevent the rule being used to shelter investment gains, and the stablecoin provision would apply for tax years beginning after December 31, 2025.
Read more: Deutsche Bank Backs Coinbase’s “Everything Exchange” With Bullish US$340 Target
Targeting “Phantom Income”
On staking and mining, the bill targets “phantom income” by letting taxpayers elect to defer income recognition on rewards for up to five years, rather than being taxed immediately on receipt. The draft describes this as a compromise between taxing at the point the taxpayer gains control and deferring until sale.
The draft also applies more traditional market rules to crypto: wash sale rules, constructive sale rules, and securities-lending-style treatment for some crypto lending (only for fungible, liquid tokens; NFTs and illiquid assets are excluded).
Overall it lets professional traders use mark-to-market accounting, eases appraisal rules for donating large-cap digital assets, over US$10 billion (or AU$15.3 billion), and says passive, protocol-level staking by investment funds is not a trade or business.
Related: Crypto Market Structure Bill Gains Momentum as Senate Push Accelerates
The post US Lawmakers Push Crypto Tax Relief: Small Stablecoin Payments & Staking Rewards in Focus appeared first on Crypto News Australia.
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