US Representatives Steven Horsford and Max Miller have reintroduced the Digital Asset Protection Accountability Regulation Innovation Taxation and Yields Act, aiming to modernize how the Internal Revenue Service handles digital asset taxation. The proposal, initially released in December 2025 and updated on March 26, focuses on simplifying reporting rules for cryptocurrency users.
One of the most notable revisions involves treatment of small transactions, commonly referred to as de minimis gains. The earlier draft proposed a $200 exemption threshold for payments made using regulated payment stablecoins, allowing minor purchases such as everyday retail transactions without tax reporting. The March 2026 version removes the fixed threshold but introduces a new rule stating that no gain or loss would be recognized on the sale of regulated payment stablecoins unless the taxpayer’s basis falls below 99% of the redemption value. The bill also introduces a deemed $1 basis for exchange transactions separate from stablecoin sales.
Wash Sale Rules and Staking Distinction Included in Updated Proposal
The revised legislation would also apply wash sale rules to digital assets, aligning crypto taxation more closely with traditional securities regulations. Similar provisions were previously supported by Cynthia Lummis, who included comparable rules in a separate crypto tax proposal last year.
Additionally, the bill distinguishes between passive staking and more active activities such as trading, recognizing differences in how digital assets generate income. Although the timeline for passing the bill remains uncertain, discussions in United States Congress suggest crypto taxation may be included in broader fiscal negotiations tied to future federal budget planning under Donald Trump’s fiscal year 2027 proposals.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.