Today, U.S. Sen. Cynthia Lumith (R-WY) has introduced a comprehensive digital property tax law that can significantly increase the use of Bitcoin and other cryptocurrencies by reducing bureaucratic deficits, modernizing obsolete tax rules, and supporting innovation in Bitcoin and crypto.
“To stay competitive, we need to change tax laws to embrace the digital economy, rather than paying for digital asset users,” Lummis said. “This groundbreaking law is fully paid, cuts bureaucratic red tape and establishes common sense rules that reflect how digital technology works in the real world. It cannot allow archaic tax policies to curb American innovation.
The proposal introduces a de Minimis exemption that excludes profits or losses on small digital assets due to taxation, with $300 a year, $5,000 a year, and inflation adjustments in 2026.
The bill guarantees Bitcoin and other crypto loans are not taxed as sales and are in line with traditional securities lending and capital efficiency improvements. It also applies 30-day wash sales rules to digital assets, closing loopholes and promoting tax fairness across asset classes.
The bill will allow digital asset dealers and traders to choose to handle taxes from marks to markets, and will align Bitcoin and other cryptos with existing rules for securities and goods. This allows for more accurate income recognition based on fair market value and eliminates any discrimination based on asset type.
It also protects taxation on mining and staking until assets are sold, reducing the burden of being taxed on unrealized income. Additionally, the bill will remove the valuation requirements for charitable contributions of aggressively traded digital assets, contributing to Bitcoin and crypto nonprofits, making it easier to treat it like publicly traded stock.
“The Act is estimated by the Joint Committee on Congressional Taxes to generate approximately $600 million in net revenue during the 2025-2034 budget window,” the press release said.
Senator Ramis emphasized the importance of public opinion in shaping a fair and positive approach to Bitcoin and the broader digital asset economy. “I welcome public comments about this law as I am trying to bring public comments about this law to the president’s desk,” she said.
Source: https://bitcoinmagazine.com/news/senator-lummis-introduces-digital-asset-tax-legislation
