Ways and Means Crypto Tax Markup: What the September 2026 Hill Roundup Means for Firms

The House Ways and Means Committee has scheduled a legislative markup for the week of September 15, 2026, and cryptocurrency taxation is explicitly on the agenda. That single item makes this one of the most operationally significant congressional moments for digital asset tax practitioners in recent memory, even though the broader legislative calendar is thin. Congress returned briefly before the midterm run-up, no major tax bills are expected to clear both chambers in this window, but a committee markup can crystallise language that survives into future legislation. Firms and CFOs relying on crypto accounting software to track positions should pay close attention to what emerges.

The Legislative Landscape This Week

Both chambers came back to Washington for a short stretch before heading home for the final midterm push. The House is scheduled to wrap its September work period after this week, and the Senate plans to run through the first days of October. The compressed calendar means the Ways and Means markup on crypto taxation is effectively the headline tax event of the period.

Why a Markup Matters Even Without a Floor Vote

A markup is the formal process by which a committee drafts, amends, and votes on legislation. Text that clears the committee gains significant procedural momentum. Even if a standalone crypto tax bill does not reach the full House before the midterms, the specific language around digital asset reporting, gain recognition triggers, or broker definitions that survives markup will influence the next Congress. Practitioners who track crypto tax reporting rules need to monitor the markup's output closely, because draft statutory language can crystallise positions that the IRS later relies on when writing guidance.

For accounting firms and CFOs advising clients with digital asset portfolios, the practical implication is to avoid treating the markup as background noise. Any language that shifts how crypto gains are characterised, or that expands or narrows broker reporting obligations, could require changes to how positions are classified in client books. Good digital asset accounting software processes will need to reflect whatever definitional choices emerge from the committee.

BBA Partnership Audits: The Tax Court Ruling Every Crypto Partnership Must Read

Alongside the legislative action, the US Tax Court handed down a decision that carries direct risk implications for any entity structured as a partnership and engaged in crypto activity. The court upheld a Notice of Final Partnership Adjustment issued under the Bipartisan Budget Act centralized partnership audit regime, ruling that the adjustment was timely because the partnership had signed an agreed extension of the IRC Section 6235 limitations period, stretching the deadline through May 30, 2025.

What the Court Actually Decided

The partnership argued that the IRS was boxed in by the standard 330-day window that begins when the IRS issues a Notice of Proposed Partnership Adjustment. The Tax Court disagreed. The court read IRC Section 6235 as allowing adjustments through whichever applicable limitations period runs latest, meaning a signed extension agreement can substantially lengthen the IRS's reach. The 330-day clock is not an outer limit; it is a default that a statute extension can override.

Implications for Crypto-Holding Partnerships

Many digital asset investment funds, DeFi project entities, and crypto mining joint ventures are structured as partnerships and fall squarely within the BBA regime if they meet the relevant thresholds. The Tax Court's reasoning means those entities cannot assume that signing a statute extension during an examination simply buys time on a specific issue. It also prolongs the IRS's authority to make partnership-level adjustments more broadly.

For accounting firms running audits or providing tax advisory services to partnership clients with crypto holdings, this decision raises an immediate action item: review any open BBA examination files where statute extensions have been executed. Confirm the scope of the extended period and assess whether positions that were considered resolved could still be subject to adjustment. Crypto positions are particularly sensitive here because valuation disputes, staking income characterisation, and hard fork treatment remain unsettled in many examination cycles.

From a crypto bookkeeping software perspective, the ruling is a reminder that historical transaction records need to be retained and accessible well beyond the standard three-year lookback. If an examination window is extended, the partnership will need clean, auditable records of every on-chain event, cost basis election, and fair value determination for the period under review.

Budget Outlook: Higher Revenue Projections, Missing Deficit Numbers

The Office of Management and Budget transmitted updated budget estimates to Congress during the same week. The administration's revised figures attribute higher projected 2027 revenues to technical adjustments in individual income tax models and economic shifts affecting corporate income tax receipts. Projected 2026 receipts are lower, partly reflecting revised expectations around customs duty collections.

One detail stands out: the estimates do not include projections for the annual deficit, which is expected to exceed two trillion dollars. For tax policy purposes, that omission matters because deficit pressure is often the lever that accelerates revenue-raising measures, including tighter digital asset reporting and gain recognition rules. A Ways and Means Committee working under fiscal constraint is more likely to produce crypto tax provisions that broaden the tax base rather than narrow it.

OECD Pillar Two: Updated GloBE Information Return

The OECD released an updated GloBE Information Return that incorporates the Pillar Two simplifications agreed in the January 2026 Side-by-Side Package. The revised return applies to fiscal years beginning on or after December 31, 2025, which means multinational groups with digital asset operations are already inside the first reporting cycle that must use the new form.

What Changed and Who Is Affected

The January 2026 Side-by-Side Package introduced a set of agreed simplifications to reduce compliance burden for in-scope multinational groups. The updated GloBE Information Return now embeds those changes, so any group that was using the earlier version of the form for its 2025 fiscal year filings will need to transition to the revised template for 2026 and beyond. For digital asset groups with entities in multiple jurisdictions, this is not a minor administrative update. The GloBE return requires jurisdiction-by-jurisdiction data on income, taxes, and effective tax rates, and crypto revenues complicate those calculations because asset classification, functional currency, and gain recognition timing can differ across jurisdictions.

For a deeper look at how evolving international accounting standards intersect with digital asset reporting, see our coverage of OECD Pillar Two reporting and what it means for digital asset groups.

Other Regulatory Developments Firms Should Track

Several other items from the September 15 roundup carry compliance relevance, even if they sit outside the crypto-specific lane.

Opportunity Zone Reporting Requirements

Proposed regulations would introduce annual information return obligations for Qualified Opportunity Funds and Qualified Opportunity Zone Businesses, including investor statements and information-sharing requirements between funds and portfolio businesses. Penalties would apply for failures to file or furnish required statements, and Form 8996 reporting obligations would be updated. Any fund that holds digital assets within an opportunity zone structure needs to assess how these requirements interact with existing crypto reporting workflows. The rules would take effect when final regulations are published.

Foreign Tax Credit Modifications

Separate proposed regulations address how deductions are allocated to foreign source GILTI income for foreign tax credit limitation purposes, reflecting changes made by recent legislation. The rules also cover the calculation of deduction eligible income and foreign-derived deduction eligible income. They generally apply to tax years beginning after December 31, 2025, and taxpayers can rely on them before finalisation if applied consistently. Multinationals with offshore crypto mining or trading operations should model the impact on their foreign tax credit positions before year-end.

Disaster Loss Relief Extension

President Trump signed legislation extending disaster relief provisions through December 31, 2026. The law covers taxpayers affected by qualified disasters occurring after July 4, 2025 and before January 1, 2027, preserving enhanced casualty loss rules including the ability to claim certain disaster losses without clearing the standard 10% of adjusted gross income threshold and the option to add qualified disaster losses to the standard deduction. While this is not a crypto-specific measure, clients who suffered theft losses on digital assets in a presidentially declared disaster area should confirm whether their losses qualify under these extended rules, given the ongoing uncertainty around crypto theft loss deductibility under general IRC provisions.

Clean Fuel Production Credit Guidance

The IRS issued guidance providing the calendar year 2026 emissions rate table for the IRC Section 45Z clean fuel production credit, reflecting recent legislative changes. The guidance is effective September 8, 2026. Crypto mining operations that have invested in sustainable energy infrastructure may want to assess whether any clean fuel activities qualify for this credit, though the intersection with mining economics will depend heavily on the specific energy sources and production processes involved.

IRS CAP Program Applications

The IRS opened applications for the 2027 Compliance Assurance Process through October 30, 2026, with acceptance decisions expected in February 2027. The CAP program allows eligible large corporate taxpayers to resolve tax issues with the IRS in real time before filing returns. For large corporate entities with significant digital asset holdings, CAP participation offers a path to resolve novel crypto classification questions before they mature into examination disputes. Given the current pace of IRS crypto enforcement activity, real-time resolution is worth evaluating.

Accounting and Tax Implications for Firms and CFOs

Pulling these threads together, the September 15 week presents a cluster of compliance considerations that firms should address before year-end.

For Accounting Firms

The Ways and Means crypto markup is the priority watch item. Monitor the committee's output for changes to broker reporting definitions, gain recognition rules, and the tax treatment of staking, lending, and DeFi activity. Any new statutory language will flow into how you advise clients on position classification and disclosure. Separately, the Tax Court's BBA ruling is a prompt to audit your open partnership examination files. Where statute extensions are in place, the IRS's adjustment window is longer than many practitioners assumed, and crypto positions held through partnership structures carry elevated audit risk in that context.

The OECD's updated GloBE Information Return requires immediate attention for any multinational client group. The revised template is mandatory for fiscal years beginning on or after December 31, 2025, so transition planning cannot wait. Firms supporting clients with the best available crypto accounting software workflows should verify that their data extraction and reporting processes can populate the updated return fields accurately.

For background on how the broader legislative environment around digital assets has been evolving, our analysis of how the Clarity Act shapes crypto accounting obligations provides useful context for client conversations.

For CFOs

If your entity is structured as a partnership and holds digital assets, the Tax Court ruling is a direct risk flag. Engage tax counsel to review any open BBA examination periods and confirm the scope of any signed statute extensions. Do not assume that extension agreements entered during a specific issue examination have a narrowly bounded effect. For multinational groups, the Pillar Two update means your GloBE data collection for fiscal year 2026 must align with the revised information return template from day one of the reporting period. Build that into your year-end close and quarterly data reconciliation processes now, rather than discovering the gap at the filing deadline.

Frequently Asked Questions

What is the Ways and Means crypto taxation markup and why does it matter?

A markup is a formal committee session where legislators draft and vote on proposed bill language. The Ways and Means Committee's decision to include cryptocurrency taxation in its September 2026 markup means that specific statutory language around digital asset reporting or gain recognition could be approved at committee level, giving it momentum for future floor consideration. Even if a standalone bill does not pass before the midterms, the language that clears committee often resurfaces in larger legislation.

How does the Tax Court's BBA ruling affect crypto partnerships specifically?

The ruling confirms that when a partnership signs a statute extension agreement during an IRS examination under the BBA centralised audit regime, the IRS's authority to issue partnership adjustments extends through the full agreed period, not just the standard 330 days from the Notice of Proposed Partnership Adjustment. Crypto-holding partnerships face particular exposure because many open examination cycles involve unsettled questions around staking income, hard fork treatment, and valuation methodology, and those positions can remain subject to adjustment for longer than partners may have realised.

Which entities must use the updated OECD GloBE Information Return?

Any multinational group in scope for Pillar Two with a fiscal year beginning on or after December 31, 2025 must use the revised GloBE Information Return that incorporates the January 2026 Side-by-Side Package simplifications. Groups with digital asset operations need to ensure their jurisdiction-by-jurisdiction data captures crypto revenues and the associated tax positions in a format compatible with the updated return template.

Can clients with crypto theft losses benefit from the extended disaster relief rules?

Potentially, but only if the loss occurred in connection with a qualified disaster as defined under the legislation, covering disasters occurring after July 4, 2025 and before January 1, 2027 in areas subject to a federal disaster declaration. Pure theft losses unconnected to a declared disaster do not qualify. The enhanced casualty loss rules relax the 10% AGI floor and allow qualifying losses to be added to the standard deduction, but the eligibility criteria are specific and fact-dependent.

What should firms do right now given these developments?

Three immediate actions stand out. First, track the Ways and Means markup output closely and assess any crypto tax language against your clients' current position classifications. Second, review all open BBA examination files involving partnership clients with crypto holdings and confirm the effective audit window under any signed statute extensions. Third, verify that your GloBE reporting processes for multinational clients are aligned with the updated information return template for fiscal years starting December 31, 2025 or later.

Source: Forvis Mazars