House Ways and Means Committee to Review Crypto Tax Bill on Sept. 16; Mining Tax Deferral in Focus

The House Ways and Means Committee is scheduled to hold a markup on September 16 to review tax rules for crypto assets (virtual currencies). The main points of focus are a proposal to defer the taxation of tokens earned through mining and staking until they are sold, and a proposal to extend wash sale rules—currently applied to stocks and other securities—to digital assets.

If the bills clear the committee, it could open a path to floor consideration in the House after the midterm elections. However, reports indicate some Republicans are moving to exclude certain tax provisions from the package, leaving the trajectory of deliberations fluid.

Mining Tax Deferral Proposal

One of the central bills is the "Mining and Staking Tax Clarity Act (H.R.9175)," introduced on June 8 by Republican Representative Mike Carey. Under current Internal Revenue Service (IRS) guidance, cryptocurrency earned through mining is included in gross income at the time of receipt, and staking rewards must also be included at fair market value in gross income when the taxpayer gains dominion and control over the tokens.

The new bill would give miners and stakers the option to defer recognition of income on newly generated tokens until they are actually sold. Deferred income would be treated as "ordinary income"—similar to wages, interest, or business income—rather than capital gains.