Late last month, Congressmen Steven Horsford and Max Miller reintroduced the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act, which seeks to reform the US approach to crypto and taxes. As Congress prepares to address taxes in the coming months, the crypto industry may be included, making it crucial for US-based crypto owners to understand the potential implications. The PARITY Act, first released in December, has undergone revisions, including changes to 'de minimis' gains, which exempt small transactions from tax reporting.
The latest version of the bill removes the $200 threshold for exemptions and introduces a deemed basis of $1 for exchanges. Additionally, the bill applies wash sale rules to digital asset transactions and distinguishes between 'passive staking' and trading activities. Although the next steps for the bill are uncertain, industry participants anticipate a strong push to include crypto in upcoming tax legislation.