Law & Policy

For any of you lawcasters with an interest in crypto taxation, the Senate Finance Committee held a productive hearing this morning on the taxation of digital assets. While Elizabeth Warren is still a predictable naysayer, there was a lot of bipartisan interest on the committee to move forward with long-overdue tax legislation for digital assets. There will be heated debates on some topics, like the timing of mining and staking income and a de minimis exception for cryptocurrency transactions, there are several topics on which there seems to be greater likelihood of agreement, such as market-to-market treatment for dealers and traders, the wash sale rule, the 864(b) trading safe harbor, and the extension of the securities lending rules to certain crypto lending transactions. For video of the hearing and the written submissions by the witnesses, see https://www.finance.senate.gov/hearings/examining-the-taxation-of-digital-assets.