A groundbreaking new crypto tax bill has recently made its way to the U.S. Senate, spearheaded by Senator Cynthia Lummis. This bill aims to address what she considers to be unfair and outdated tax regulations that are hindering innovation and everyday users of digital assets such as Bitcoin.
One of the key components of Senator Lummis’s bill is the introduction of a special $300 rule. This rule stipulates that small crypto transactions, like purchasing lunch or coffee, will not trigger tax reports. This means that individuals can use digital assets just like real money without the fear of running into tax-related issues. However, there is a cap on tax-free gains per year, which must not exceed $5,000. Additionally, starting in 2026, the $300 threshold will be adjusted for inflation. This provision could potentially revolutionize the way people spend crypto, making it as convenient as using a debit card.
Moreover, the bill aims to provide fairer treatment for crypto miners and stakers, individuals who help maintain blockchains and earn tokens in return. Currently, miners and stakers are often required to pay taxes as soon as they receive tokens, even if they do not sell them. Under the new bill, taxes will only be levied when the coins are sold or utilized. This approach prevents double taxation and facilitates better planning for individuals and businesses without the fear of unexpected tax liabilities.
Furthermore, the bill supports crypto lending by extending the same tax rules used for stock lending to digital assets. This means that lending crypto temporarily will not be considered a sale and will not trigger tax obligations. Additionally, donating crypto to charitable organizations becomes more straightforward as costly appraisals for commonly traded assets are no longer required. These changes could potentially encourage more individuals to engage in charitable giving using crypto assets.
Senator Lummis believes that this bill could generate around $600 million in tax revenue over the next decade. More importantly, she argues that it will safeguard innovation in the United States. By creating a tax environment that fosters participation and growth, Lummis hopes to incentivize individuals and businesses to build the future within the country’s borders, rather than seeking opportunities abroad.
Although the bill could not be attached to Trump’s “One Big Beautiful Bill,” Senator Lummis remains optimistic about its chances of passing. With public comments now open, she encourages everyone to voice their opinions and contribute to the ongoing discussion surrounding crypto taxation reform.