US Crypto Tax Reform: Seven Bills Accounting Firms and CFOs Must Track Now

Seven proposed pieces of US federal legislation, each targeting a specific gap in the current digital asset tax framework, are now in circulation simultaneously. Taken together, they represent the most coordinated legislative push on crypto taxation the US has seen. For accounting firms and CFOs with digital asset exposure, understanding each proposal is not optional. The bills touch stablecoin accounting, DeFi staking income, charitable donations, wash sales, voluntary disclosure, and anti-sheltering rules. Some carry Joint Committee on Taxation revenue estimates, which signals they are being scored and taken seriously. Here is a structured breakdown of where things stand and what it means for your practice or balance sheet.

Why Congress Is Moving Now

Digital assets are no longer a niche holding. They appear in corporate treasuries, individual retirement accounts, and commercial payment flows. Yet the Internal Revenue Code was written for traditional financial instruments, and the friction between that framework and on-chain activity has grown impossible to ignore.

The emerging legislative approach is notable for what it does not attempt: Congress is not building a separate crypto tax code. Instead, each bill extends or adapts existing IRC concepts to digital assets. That normalisation strategy matters for accounting professionals because it means the analytical tools already in place for securities, lending arrangements, and voluntary disclosure programs are the right starting point. The question is how, and when, those tools get adjusted.

The bipartisan signal

Several of these bills have attracted bipartisan support, which is itself worth noting. Historically, digital asset legislation stalled because lawmakers could not agree on whether crypto was a currency, a commodity, or a security. The current crop of bills sidesteps that definitional debate almost entirely, focusing instead on the practical compliance burdens taxpayers and their advisers face today. That pragmatic framing increases the probability that at least some provisions become law.

Stablecoin Accounting: The Less Tax Paperwork Act

The bill most directly relevant to stablecoin accounting is the Less Tax Paperwork for Digital Asset Owners Act. Under current law, every exchange of a stablecoin is technically a taxable disposition of property. Even where the economic gain or loss is negligible, the transaction must be tracked and reported. For clients holding and transacting in volume, this creates enormous bookkeeping overhead.

The proposed exclusion for qualified US dollar stablecoins

The bill would exclude gain or loss on transactions involving "qualified US dollar stablecoins," defined as instruments purchased at no less than 99.5 percent of their redemption value and sold at a price within 0.5 percent of that value. In practice, this captures the major regulated stablecoins, including USDC, when used in routine commercial transactions.

For USDC accounting specifically, this change would be significant. Treasury teams and DeFi protocols that route liquidity through USDC currently have to account for fractional gains and losses on every swap. If the exclusion passes, those micro-dispositions disappear from the tax ledger entirely, though the accounting systems still need to be capable of confirming that each transaction falls within the 0.5 percent band. That is a data and reconciliation requirement, not a reason to turn off transaction tracking.

The annual net calculation election

A second provision within the same bill would allow taxpayers to elect an annual net calculation method for certain widely traded digital assets, replacing transaction-by-transaction gain-and-loss accounting with a single year-end net figure. Any resulting gain or loss would be treated as short-term, regardless of holding period. This simplifies compliance but removes the ability to generate long-term capital gain rates on these assets. Advisers need to model the trade-off carefully before recommending the election, particularly for clients with concentrated positions held over twelve months.

Staking and Mining Income: The Tax Clarity Act

The Tax Clarity for Mining and Staking Act addresses one of the most contested questions in DeFi accounting: when is staking income taxable? Current IRS guidance treats newly minted tokens as ordinary income at the fair market value on receipt. That approach can create a liquidity mismatch, taxing income before the asset is sold, and may put token founders in an awkward position if markets interpret any sale as a negative signal.

The deferral election

The proposed legislation would confirm that newly minted digital assets are included in income at fair market value at the time of acquisition, consistent with current IRS positions, but would add an election to defer taxation until a subsequent taxable event. Taxpayers who elect deferral would recognise the deferred amount as ordinary income, not capital gain, on eventual disposition. The deferral election is therefore not a rate benefit; it is a timing benefit. Cash-flow management, not tax rate reduction, is the argument for it.

From a DeFi accounting standpoint, this matters most for protocols where staking rewards are frequent and often illiquid at the moment of receipt. Validators, liquidity providers, and founders all need to assess whether the election makes sense given their specific token economics and exit expectations. Advisers should note that once made, the election will likely lock in ordinary income treatment on disposal, so the analysis is not straightforward.

Charitable Donations of Digital Assets

The Charitable Deductions for Digital Asset Donations Act would remove the qualified appraisal requirement currently imposed on donations of digital assets, aligning their treatment with publicly traded securities. Under existing rules, donating cryptocurrency that is not listed on a major exchange, or that exceeds certain thresholds, can trigger appraisal and substantiation requirements that add cost and complexity far out of proportion to the transaction.

For clients with appreciated digital asset holdings who are also philanthropically inclined, this matters. The existing friction has likely suppressed donations relative to what equivalent equity holders would give. Removing the appraisal barrier for widely traded assets would make charitable planning with crypto genuinely comparable to planning with listed stock, opening up donor-advised fund strategies and direct gift programmes that advisers already use for traditional portfolios.

The PAR Act: Parity for DeFi and Lending Transactions

The Providing Analogous Rules for Digital Assets Act is the most technically complex of the seven bills. It would extend two existing IRC frameworks to digital assets.

Securities lending parity under IRC 1058

Currently, lending digital assets, for example posting ETH as collateral or participating in a DeFi lending protocol, can be treated as a taxable disposition because the IRC 1058 safe harbour for securities lending does not extend to crypto. The PAR Act would create an analogous safe harbour, meaning qualifying digital asset lending transactions would not trigger immediate gain recognition. For institutional clients and protocol operators engaged in collateralised lending, this is a material change. It also has direct implications for how DeFi accounting is structured, since the gain-deferral treatment would need to be tracked and reported accurately.

Foreign trading safe harbours under IRC 864

The bill would also extend the trading safe harbour for foreign persons to digital asset transactions, consistent with how the IRC already treats foreign persons trading US securities. The Joint Committee on Taxation estimates the PAR Act would raise USD 1.362 billion in revenue over ten years, suggesting the JCT believes the parity treatment generates some incremental compliance and offsets other costs.

Wash Sales, Constructive Sales, and Anti-Abuse Rules

The Applying Existing Tax Anti-Abuse Rules to Digital Assets Act would extend wash-sale and constructive-sale rules to digital assets, two changes that will directly affect tax planning strategies currently available to crypto holders.

Wash-sale extension

Under current law, the wash-sale rule, which disallows a loss where the same or substantially identical asset is repurchased within thirty days before or after the sale, does not apply to digital assets because they are property, not securities. This has allowed taxpayers to harvest losses while immediately repurchasing the same token. The proposed extension would close that window. Clients and advisers who have built loss-harvesting strategies around this gap need to review those positions now.

Constructive sale extension

Constructive sales occur when a taxpayer enters into an offsetting position that effectively locks in a gain without a formal sale. Extending this rule to digital assets would affect certain hedging and derivatives strategies. The JCT scores this bill as raising USD 2.074 billion over ten years, the largest revenue estimate of any bill in the package, which reflects how significant the current planning gap is perceived to be.

Voluntary Disclosure and Anti-Sheltering Rules

The Digital Assets Voluntary Disclosure Program Act

For clients with past digital asset tax non-compliance, the proposed Digital Assets Voluntary Disclosure Program Act would establish a formal, crypto-specific voluntary disclosure pathway. Eligible taxpayers would file amended returns, pay tax and interest, and in return receive reduced penalties and a clear resolution process. The current IRS Voluntary Disclosure Program has not been specifically designed for digital assets, and there is evidence that the existing Form 14457 process creates enough friction to deter some taxpayers from coming forward at all.

A tailored programme would be valuable for accounting firms managing remediation engagements. It also creates a window of opportunity: clients who resolve past positions before any programme formally closes are typically better positioned than those who wait for enforcement. Advisers should be having these conversations with clients who have unreported digital asset gains from prior years.

The End Digital Assets Tax Shelters Act

The final bill in the package targets expatriation-based planning, where a US citizen or resident relocates to a low-tax jurisdiction before disposing of appreciated digital asset holdings. The proposal would treat such individuals as continuing to be US residents for sourcing purposes on those sales, effectively neutralising the tax benefit of pre-sale emigration. This mirrors concerns already present in the traditional exit tax framework and signals that Congress views crypto as a vehicle for the same strategies it has long scrutinised in the securities context.

What Accounting Firms and CFOs Should Do Right Now

None of these bills has been enacted. Several have not yet received committee votes. But the breadth and specificity of the package, combined with the JCT revenue scoring on at least two bills, means advisers should treat these as near-term planning inputs rather than distant speculation.

Immediate practical steps

First, audit client digital asset positions against each proposal. Clients transacting heavily in USDC or other regulated stablecoins should understand what the stablecoin exclusion would mean for their current bookkeeping workflows and whether their digital asset accounting software is capable of confirming the 0.5 percent price-band test on each transaction. Second, identify clients who are currently harvesting crypto losses through wash-sale-equivalent strategies and model the after-tax impact of the proposed extension. Third, flag any clients with prior non-compliance and open a conversation about voluntary disclosure before a formal programme is established, since terms may tighten once a specific regime is in place. Fourth, review any DeFi lending or staking arrangements for clients who might benefit from the deferral election or the IRC 1058 safe harbour, and document the analysis now so that elections can be made promptly if and when the legislation passes.

On the accounting standards side, it is worth keeping these legislative proposals alongside the parallel FASB process on digital asset classification. The legislative and accounting standard tracks are moving simultaneously, and positions taken under one framework may constrain options under the other. Our earlier coverage of the stablecoin accounting debates at the FASB IAC and the Senate CLARITY Act and what it means for stablecoin accounting provide useful context for how these parallel tracks interact.

Source: Forvis Mazars