Representatives Steven Horsford and Max Miller have reintroduced the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act, which seeks to update the US approach to cryptocurrency and taxes. As Congress is set to address tax reforms in the coming months, cryptocurrency may be included, making it crucial for US crypto owners to report their digital asset holdings and transactions.
The revised bill introduces changes to 'de minimis' gains, which exempt small transactions from tax reporting. The industry has long advocated for a de minimis exemption to simplify transactions like buying coffee with crypto without incurring capital gain or loss reporting. The latest draft removes the $200 threshold and creates a deemed basis of $1 for exchanges. It also applies wash sale rules to digital asset transactions and distinguishes between 'passive staking' and trading activities.
Although the bill's next steps are uncertain, industry participants expect a strong push to include crypto in upcoming tax legislation.