Last month, Congressmen Steven Horsford and Max Miller re-introduced the Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act, which seeks to update the US approach to cryptocurrency and taxes. As Congress prepares to address taxes 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 PARITY Act, initially released in December, was re-released on March 26 for further review.
One notable change is the section addressing 'de minimis' gains, which allows for small transactions to be exempt from tax reporting. The industry has long advocated for a de minimis exemption for limited transactions, making it easier for individuals to use crypto for everyday purchases without reporting capital gains or losses.
The revised bill 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.
While the next steps for the bill are uncertain, industry participants expect a strong push to include crypto in any upcoming tax legislation.