US House crypto tax package omits mining, staking reward deferral

The House Ways and Means Committee released a 114-page crypto tax package, the Digital Asset Tax Certainty Act (H.R. 10357), ahead of a scheduled markup this week and the measure does not include a reward-timing deferral for miners and stakers. That omitted provision had been part of Representative Mike Carey’s Tax Clarity for Mining and Staking Act, introduced in June, and would have let taxpayers choose to recognize newly created tokens as income when received or defer taxation until the tokens are sold. Because the deferral language is absent, mining and staking rewards will generally be taxed when they are received or otherwise brought under a recipient’s control, meaning liability can arise before any sale for cash. Industry groups including the Blockchain Association, Crypto Council for Innovation and the Digital Chamber had urged lawmakers to adopt Carey’s approach, arguing that taxing rewards at receipt can create liquidity problems for miners and stakers; those groups also opposed an amendment that would have limited any deferral to five years. The package nevertheless retains several mining- and staking-related provisions. It would treat income from blockchain validator activities as ordinary income, set rules for whether that income is sourced inside or outside the United States, and permit qualifying investment trusts to stake digital assets without jeopardizing their trust status. Beyond mining and staking, the bill proposes a number of other changes to digital-asset taxation. It would prevent realization of gains or losses when crypto is used to pay network or transaction fees of up to $10, create special tax treatment for qualifying US dollar stablecoins, and allow certain digital-asset loans to be structured without being treated as taxable sales. The draft also includes measures to simplify accounting for widely traded crypto assets, extend wash-sale and constructive-sale rules to digital assets, and set up a voluntary disclosure program for taxpayers correcting prior digital-asset tax errors. The House action comes while the Senate is considering the CLARITY Act, legislation intended to clarify how the SEC and CFTC divide oversight of the crypto market. The debate over reward-timing and other tax rules highlights competing industry and policy concerns about liquidity, tax administration and regulatory clarity as Congress moves to update tax law for digital assets.