Crypto Tax Bill Clears House Committee 38-5, One Day After CLARITY Act Fails

The House Ways and Means Committee voted 38-5 on Sept. 16 to advance the Digital Asset Tax Certainty Act to the full House. The vote came less than 24 hours after the Senate failed to advance the Digital Asset Market Clarity Act. The wide margin reflected strong bipartisan backing for the measure.

The billtargets one of the most common complaints among everyday crypto users: the tax burden triggered by routine, small-value transactions. Under the legislation, network and transaction fees of $10 or less would not trigger a taxable event. Committee Chair Jason Smith said the current system forces someone buying a cup of coffee with crypto to navigate what he called “an absurd maze of compliance.” That provision, if the bill becomes law, would not take effect until December 2027.

The legislation also sets out how income from mining and staking would be treated. Both would be taxed as ordinary income under the bill. However, the timing of when that income is recognized remains unresolved. An earlier version of the bill included an option to defer income recognition, but that provision was removed before the committee vote. Representative Steven Horsford, a Nevada Democrat who worked on the bill, said he believes Congress still needs to address that timing question directly.

The bill also requires the Treasury Department to establish a Digital Asset Voluntary Disclosure Program within 12 months of enactment. Taxpayers who qualify would be able to amend earlier returns and settle any tax, interest, and penalties owed. Certain investment trusts would also be allowed to stake holdings without that activity alone affecting their tax status.

Not all committee members backed the bill without reservation. Representative Lloyd Doggett, a Texas Democrat and senior committee member, said the legislation “bestows billions in tax breaks for the crypto industry, benefiting billionaire crypto whales and some of the richest Americans like the Trump family.” He argued the committee was prioritizing crypto industry interests over broader taxpayer needs. His comments came a day after similar ethics-related objections contributed to the Senate’s failure to advance the CLARITY Act, with Democrats citing concerns over President Donald Trump’s growing crypto interests.

The bill also addresses wash sale rules and broker reporting requirements, and it seeks to align the tax treatment of digital assets with that of other financial assets. Alison Mangiero, chief strategy officer and head of US policy at the Crypto Council for Innovation, said the lame duck period after November elections is the most likely window for the Senate to take up the bill. She pointed to the Senate Finance Committee as the next venue for action and noted several provisions still need refinement, including de minimis relief for everyday transactions and the timing of income recognition for staking and mining rewards.

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The House is expected to go on recess until after the November elections, leaving limited time for further movement on the bill before the current congressional session ends. The bill’s 38-5 committee vote establishes legislative momentum that supporters hope will carry into the next session if it does not advance before year-end.

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