Digital Asset Tax Certainty Act Advances: What Congress's September 2026 Activity Means for DeFi Accounting
The week of September 15, 2026 was one of the busiest on Capitol Hill for digital asset tax policy in years. The House Ways and Means Committee advanced a wide-ranging crypto tax bill, the Senate's broader legislative package fell short of the votes needed to proceed, and the CFTC quietly sent draft crypto market rules to the White House for review. For accounting firms, CFOs with digital asset exposure, and anyone building or advising on DeFi accounting frameworks, each of these developments carries real compliance weight.
The Digital Asset Tax Certainty Act Clears Committee
On September 16, the House Ways and Means Committee approved the Digital Asset Tax Certainty Act by a 38-to-5 bipartisan vote, sending the bill to the full House for consideration. That margin is notable: it signals genuine cross-party appetite for federal crypto tax rules, rather than the partisan gridlock that has stalled similar efforts in prior sessions.
What the Bill Would Do
The legislation covers several areas that practitioners have been pushing Congress to address for years:
- Digital asset reporting: The bill would establish clearer federal reporting obligations for crypto transactions, reducing the current patchwork of guidance that leaves brokers, DeFi protocols, and their advisers in legal grey zones.
- Wash sale rules: Unlike equities, crypto assets are not currently subject to the wash sale rule under IRC Section 1091, which allows taxpayers to sell at a loss and repurchase immediately. The bill would change that, bringing digital assets into the wash sale framework.
- Mining and staking activities: The bill specifically addresses tax treatment of income from mining and staking, areas where existing IRS guidance is thin and where DeFi accounting practices vary widely across firms.
- De minimis rule: A de minimis exemption would apply to certain smaller transactions, a practical concession that acknowledges the compliance burden of tracking every micro-transaction in a DeFi or payments context.
Timing: The Lame-Duck Window
The House is now in recess until after the November elections. Further floor action is not expected until the post-election lame-duck session. That timeline matters for planning purposes: firms and CFOs should treat the bill's provisions as a near-term probability rather than a distant possibility, but should not yet restructure operations around them. The bill could be amended during lame-duck negotiations, or it could stall entirely if the political landscape shifts after November.
The Senate's Broader Bill Fails Cloture
On September 15, the Senate's broader legislative package failed to clear a procedural cloture vote, receiving only 49 of the 60 votes required to advance. Republicans and Democrats remained divided over ethics provisions and other policy riders attached to the bill. The failure does not kill the underlying digital asset provisions permanently, but it removes the Senate as an immediate legislative vehicle. The action now rests with the House bill and whatever the lame-duck session produces.
What This Means for DeFi Accounting Uncertainty
The Senate vote failure extends the period of regulatory ambiguity that DeFi-facing teams have been navigating for years. Without statutory wash sale rules, staking income guidance, or a de minimis threshold written into federal law, practitioners are still working from IRS notices, revenue rulings, and FAQ-style guidance that can be withdrawn or superseded. Firms advising clients with DeFi exposure should document their current interpretive positions carefully, because whatever Congress ultimately passes may require retroactive adjustments to how prior-year positions were taken.
CFTC Sends Crypto Market Rules to White House
Following the Senate vote, the CFTC submitted two proposed rulemakings to the Office of Information and Regulatory Affairs for review: "Regulation Crypto Asset Transactions" and "Regulation Crypto Asset Markets." The text of both proposals had not been publicly released as of the Forvis Mazars report date. OIRA review is a standard step before proposed rules are published in the Federal Register, so public comment periods are likely to follow.
Why Firms Should Watch This Closely
CFTC jurisdiction over crypto commodity markets has been contested for years, particularly for assets that do not qualify as securities under SEC definitions. If the CFTC's proposed rules establish clear transaction and market conduct standards for crypto commodities, that has direct implications for how firms classify and account for those assets, how derivatives and perpetual futures are treated on the balance sheet, and what AML and recordkeeping obligations apply at the platform level. Firms using digital asset accounting software should flag this as a configuration review trigger: jurisdiction-specific rules affect cost basis methodology, gain or loss classification, and reportable event definitions.
Other Legislative Developments Affecting Tax Practitioners
Beyond the digital asset bills, several other Congressional actions from the same week are relevant to firms with broader tax practices.
Taxpayer Protection Bills Pass the House
On September 15, the House passed four bipartisan bills aimed at taxpayer rights and fraud relief. The measures would expand relief for fraud-related losses, allow postponement of tax deadlines for hostages and wrongfully detained Americans, clarify the statute of limitations for fraudulent returns, and permit the National Taxpayer Advocate to appear as an amicus curiae in federal court proceedings. All four bills now move to the Senate.
ESOP Legislation Sent to the President
Separately, legislation governing employee stock ownership plans cleared Congress and was sent to President Trump for signature. The bill would codify adequate consideration standards for ESOP transactions, allowing fiduciaries to rely on independent appraisers using the valuation principles in Revenue Ruling 59-60 when determining fair market value of stock in closely held companies. This resolves long-standing litigation risk around ESOP valuations, relevant to any firm advising closely held businesses on equity succession planning.
Cash Rounding Legislation
Bipartisan legislation advanced from the House would permit businesses to round cash purchases to the nearest nickel while leaving electronic payments unchanged, providing a federal safe harbor in response to the penny shortage and inconsistent state-level rounding rules.
Key Court Decisions From the Same Week
Two significant court rulings also landed in the same period, each with implications for tax advisers.
Second Circuit on Self-Employment Tax: Soroban Decision
The U.S. Court of Appeals for the Second Circuit affirmed the Tax Court's holding that the IRC Section 1402(a)(13) limited partner exception from self-employment tax applies only where a partner both holds limited liability and does not actively manage the partnership's business. The court rejected the argument that state law limited partner status alone is sufficient. Because Soroban's limited partners actively managed the hedge fund and played direct roles in generating its income, they were held not to qualify for the exception. The decision aligns broadly with the Tax Court's own prior analysis in similar cases, though the precise standards applied differ somewhat between the two bodies. Firms advising investment fund partnerships on compensation structuring should review their limited partner income classifications in light of this ruling.
Tax Court Follows Prior Precedent on IRC Section 245A
In a separate case, the Tax Court ruled for the IRS on two IRC Section 245A questions, following its prior analysis. First, the dividends received deduction under Section 245A is limited to dividends attributable to shares directly held by the taxpayer, not expanded through indirect ownership chains. Second, the court reaffirmed its method for calculating foreign tax credits disallowed under Section 245A(d)(1) in connection with Section 965 transition tax inclusions. The court rejected Sysco's proposed alternative interpretation and granted summary judgment for the IRS. Firms with multinational clients holding foreign subsidiaries should review their Section 245A DRD calculations for consistency with the court's confirmed approach.
IRS Administrative Updates
New Citizenship Question on Draft Tax Form
The IRS released a draft tax form that would require taxpayers, and a spouse if filing jointly, to indicate whether they are U.S. citizens, U.S. nationals, or otherwise lawfully authorised to work in the United States. The agency stated the question is intended to curb abuse of refundable tax credits. The form is in draft stage and subject to change before final release.
Revenue Rulings and Procedural Updates
The IRS also released the October 2026 applicable federal rates, including the adjusted AFR, adjusted federal long-term rate, long-term tax-exempt rate, and percentages for the low-income housing credit. A separate revenue procedure extends the replacement period for livestock sold due to drought conditions in eligible counties where severe, extreme, or exceptional drought continued through the 12-month period ending August 31, 2026, allowing eligible taxpayers to defer gain recognition under IRC Section 1033(e). A further notice provides the corporate bond monthly yield curve, spot segment rates from August 2026 data, and applicable 24-month average corporate bond segment rates for September 2026.
Accounting and Tax Implications for Firms
The Digital Asset Tax Certainty Act, if enacted in anything close to its current form, would reshape the minimum requirements for digital asset accounting software and crypto bookkeeping software configurations across the industry. Wash sale tracking for crypto, currently not legally required, would need to be built into position-level accounting systems. Staking income recognition, currently handled under fragmented IRS guidance, would have statutory direction. The de minimis rule would need to be operationalised with transaction-level thresholds that vary by client and portfolio.
For B2B clients, the immediate priority is gap analysis: map current digital asset accounting software configurations against each provision in the bill, identify which workflows would require change if the bill passes in lame-duck, and document the current interpretive position taken on staking income and wash sale treatment so that any retroactive adjustments are auditable. Firms should also monitor the CFTC's OIRA submissions closely, as published proposed rules will open a public comment window that represents an opportunity to shape the final compliance obligations.
The CLARITY Act's Senate failure, covered in more detail in our earlier analysis of the Senate procedural vote and its implications for stablecoin and DeFi accounting, means that DeFi protocol operators and their advisers remain in a holding pattern on the foundational jurisdictional questions. The Ways and Means bill addresses tax treatment but does not resolve the underlying securities-versus-commodity classification debate, which continues to drive divergent accounting treatment across firms.
For context on how the Ways and Means Committee vote developed, see our earlier coverage of the Digital Asset Tax Certainty Act's committee approval.
Source: Forvis Mazars
Frequently Asked Questions
Does the Digital Asset Tax Certainty Act become law automatically after the Ways and Means vote?
No. Committee approval sends the bill to the full House floor, but it still needs to pass the full House, pass the Senate in some form, and be signed by the President. Given the House recess, the next realistic window is the post-election lame-duck session, and the bill's final shape may differ from the version approved in committee.
What does the proposed wash sale rule mean for crypto portfolios held by investment funds?
Under current law, crypto assets fall outside IRC Section 1091, so a fund can sell a position at a loss and repurchase it immediately without the wash sale disallowance that applies to securities. If the bill passes, that strategy would no longer be available for digital assets. Funds and their tax advisers should model the impact on loss-harvesting programmes before the lame-duck session concludes.
How would a de minimis rule work in practice for DeFi transactions?
The bill proposes a de minimis threshold below which certain transactions would not trigger a taxable event. The precise threshold amount and eligible transaction types will matter significantly for DeFi users who execute many small swaps or liquidity provision actions. Firms should not assume any specific figure is final until the bill is enacted in its final form.
What does the Soroban Second Circuit decision mean for fund partnership structures?
The ruling confirms that self-employment tax exposure for limited partners depends on actual involvement in managing the partnership, not just the formal state law label. Hedge funds and other investment partnerships where limited partners actively participate in management decisions should review whether the Section 1402(a)(13) exception is being claimed appropriately, and consider whether restructuring is warranted in light of the decision.
When will the CFTC's proposed crypto market rules be available for review?
As of the September 22, 2026 Forvis Mazars report, the text of both CFTC rulemakings had not been publicly released. The OIRA review process typically precedes Federal Register publication, after which a public comment period opens. Firms should monitor the CFTC's official rulemaking docket for publication dates.