House crypto tax bill offers $10 fee exemption, tightens wash sale rules

The House Ways and Means Committee has released a 114-page crypto tax package that would exempt certain network fees under $10 from tax while extending wash-sale rules to digital assets ahead of a Sept. 16 committee markup.

Bloomberg Government reported on Sept. 15 that committee Chair Jason Smith, a Missouri Republican, released the Digital Asset Tax Certainty Act on Monday night after lawmakers spent months working on separate proposals covering the tax treatment of digital assets.

The package incorporates provisions developed through earlier Republican proposals and bipartisan legislation from Reps. Steven Horsford, D-Nev., and Max Miller, R-Ohio. It covers small crypto transactions, gain and loss calculations, transfers, wash sales, mining, staking and broker requirements.

Committee documents show H.R. 10357 is scheduled for markup at 10 a.m. ET on Wednesday. Lawmakers will consider it alongside several unrelated tax and health care measures before deciding whether to advance the legislation.

Crypto tax bill would exempt some fees under $10

One provision would remove tax on qualifying network and transaction fees worth less than $10, addressing small blockchain costs that can currently create tax reporting requirements.

The exemption would not be available to every user. Anyone who completed more than 5,000 transfers during the previous year would be excluded, keeping the carve-out away from accounts with particularly high transaction activity.

Small transactions have been part of the House tax debate for months. In June, crypto.news previously reported that lawmakers were considering crypto tax proposals intended to reduce filing requirements for digital asset users while setting rules for areas including mining, staking and routine transactions.

Current U.S. tax treatment generally treats digital assets as property, meaning disposals can produce taxable capital gains or deductible losses. Crypto-to-crypto swaps and payments using digital assets can count as disposals, while transaction costs paid in tokens can create their own tax calculations.

The reporting system has become more detailed as broker requirements take effect. IRS crypto tax rules require wallet-by-wallet basis tracking, while brokers began reporting gross proceeds on Form 1099-DA for the 2025 tax year. Cost-basis reporting is being phased in for transactions during 2026.

Coinbase had pushed Congress to reduce the burden attached to small payments during the House tax debate. In testimony submitted for a June 9 Ways and Means hearing, Coinbase Vice President of Tax Lawrence Zlatkin argued that calculating gains and losses on routine stablecoin payments and blockchain fees creates significant compliance work.

The exchange called for tax relief for stablecoin spending and small crypto transactions, while backing delayed taxation of mining and staking rewards.

Wash-sale rules would reach digital assets

The legislation would close a tax treatment difference that currently allows crypto investors to sell a digital asset at a loss, buy it back immediately and still use the realized loss for tax purposes.

Federal wash-sale rules apply to securities and generally prevent an investor from claiming a loss when substantially identical securities are repurchased within the required period. Digital assets have not been covered by the statutory rule in the same way.

Provisions drawn from H.R. 9172, the Applying Existing Tax Anti-Abuse Rules to Digital Assets Act, would extend wash-sale and constructive-sale rules to digital assets. Qualified U.S. dollar stablecoins would be excluded.

Reps. Jodey Arrington and Mike Carey introduced the underlying proposal in June as lawmakers assembled several separate bills addressing unresolved crypto tax questions. The wash-sale provision has been estimated to raise $2.074 billion over fiscal years 2026 through 2036.

Smith described the committee’s work in June as an effort to give taxpayers clearer rules for digital assets, arguing that existing tax policy had not kept pace with financial technology.

Earlier House crypto tax drafts covered stablecoin payments, decentralized finance lending, charitable donations, mining, staking and anti-abuse rules. Those measures were initially presented separately before lawmakers moved toward combining parts of them into a larger package.

Mining and staking remain the main point of dispute

Tax timing for newly created mining and staking rewards has produced one of the main disagreements surrounding the package.

H.R. 9175, the Tax Clarity for Mining and Staking Act, proposed allowing miners and stakers to defer income recognition on newly created tokens until the assets are sold. The provision was estimated to reduce federal revenue by $2.956 billion between fiscal 2026 and 2036.

Current IRS treatment generally taxes staking rewards as ordinary income once a taxpayer gains dominion and control over the assets. Their value at that point becomes the cost basis used when calculating a later gain or loss.

Three crypto industry groups pressed Congress in June to keep the proposed tax-timing treatment unchanged. The Blockchain Association, Crypto Council for Innovation and The Digital Chamber opposed a five-year cap on the proposed treatment and asked lawmakers to pass H.R. 9175 without changes.

Banking groups took a different position during the debate, arguing that deferring tax on mining and staking income could give crypto rewards different treatment from interest, dividends and other forms of investment income.

Punchbowl News reported on Sept. 13 that Ways and Means Republicans were strongly considering removing the mining and staking tax-timing provisions from the package. Multiple people familiar with the talks described the issue as the largest point of disagreement with Horsford, a Ways and Means Democrat involved in the crypto tax negotiations.

No final decision had been made when that report was published. Options discussed during negotiations included retaining the deferral, removing it or limiting the treatment to five years.

House tax effort follows June crypto hearing

The legislation follows a June 9 Ways and Means hearing where lawmakers examined a series of individual digital asset tax bills before the provisions were assembled into the current package.

Representatives from Coinbase, Fidelity Investments, Coin Center and New York University’s Tax Law Center testified at the hearing. The committee considered proposals covering mining and staking, charitable crypto donations, voluntary tax disclosure, wash sales, transaction reporting and other digital asset rules.

At the time, Democrats questioned whether some of the proposed mining and staking provisions could create new tax advantages, while industry representatives argued that existing rules can require taxpayers to recognize income before they sell the tokens they receive.

The tax markup comes during another active week for crypto legislation in Washington. The Senate is scheduled to take a procedural vote on the CLARITY Act on Sept. 15, with 60 votes needed to advance the market structure legislation.

Senate Republicans recently released a revised version containing new provisions ahead of the vote, after months of negotiations over ethics restrictions, stablecoin rewards, decentralized finance and regulatory authority. The latest CLARITY Act text introduced federal registration requirements for certain trading protocols that fail to meet its decentralization standard.

The Ways and Means Committee’s Sept. 16 meeting is scheduled to consider the Digital Asset Tax Certainty Act alongside H.R. 10334, the EFIN Verification Act of 2026, and five measures covering health care, cobalt mining and other policy areas.