A tax bill that tackles taxation on cryptocurrency has been passed on September 17, 2026. This bill aims to broaden the definition and enactment of taxation, specifically on gains and losses.
This bill comes after the Clarity bill’s failure to pass on September 16. The tax bill has its proponents and critics. Some democrats voice their concerns. One is the ‘breakthrough’ in taxation for the cryptocurrency industry, benefitting wealthy individuals and whales who profit from trades. A key example noted is the Trump family, who owns and profits from large virtual asset companies—estimates for the profit reach in the hundreds of millions of dollars. Opposition came from five democrats, while republicans held a unanimous agreement on the bill.
Under the taxation bill, mining and staking rewards will be classified as normal income. It also solves several key issues. First, is the loophole in immediate repurchasing of virtual assets after a loss; now, one has to abide by conventional securities rules. Second, is the proposal for simplified accounting for widely traded virtual assets. Third is the exemption of profits or losses of 10 U.S. dollars or less as part of capital-gains calculations.
That said, there are some issues with the bill that echo the sentiment of the democratic opposition. The taxation bill negates crypto-backed loans as taxable events. The bill also reduces penalties for those who voluntarily disclose past returns and outstanding balances. The redemption value will be used as the tax basis for USD-pegged stablecoins. And no tax—which will be classified as normal income—will not be imposed until crypto rewards are sold.
According to Politico, “Even advocates for the crypto plan said it was only a start at addressing myriad issues associated with digital assets … the package establishes rules in several areas, while leaving other questions for further consideration—today’s vote does not end that work”.
Though the bill has its supporters and contrarians, this marks progress—no matter how small—in, at least, the very creation of legislation surrounding cryptocurrency. Where the Clarity bill has failed to pass (and is expected to not pass this year), and where other government bodies have already acted, like the Securities and Exchange Commission, the taxation bill is a step forward in establishing federal—country-wide—frameworks in trading virtual assets.
