WASHINGTON, D.C. – This week, House Ways and Means member, U.S. Rep. Mike Carey (R-OH-15), introduced the Tax Clarity for Mining and Staking Act to ensure innovation in the digital assets sector remains in the United States, individual taxpayers’ mining and staking rewards are taxed fairly, and investors in digital assets can put their assets to work on the blockchain.
“American taxpayers currently face a digital asset tax landscape that is burdensome to comply with and difficult to administer,” said Rep. Carey. “The current tax treatment of mining and staking rewards fails to accurately reflect the underlying technological and economic realities of mining and staking and diverges from foundational principles of tax law. The Tax Clarity for Mining and Staking Act will help support American innovation in digital assets and ensure that miners and stakers in the United States are treated fairly.”
“Mining and staking are integral parts of the digital asset economy, but current tax law creates confusion and needless risk for those who are rightly compensated for ensuring the marketplace can function,” said Ways and Means Committee Chairman Jason Smith (MO-08). “Inconsistent rules also jeopardize the tax status of certain financial planning tools like grantor trusts that hold digital assets. The Tax Clarity for Mining and Staking Act will establish transparent rules for those engaged in mining and staking and provide appropriate and fair flexibility for individuals to meet their tax obligations. I commend Representative Carey for standing up for taxpayers and providing greater clarity while helping maintain a robust digital asset economy in the United States.”
The Tax Clarity for Mining and Staking Act confirms that the acquisition of newly minted digital assets is ordinary income but allows taxpayers to elect to treat newly minted digital assets in a manner similar to self-created property. Consistent with IRS guidance, the bill also allows grantor trusts that hold digital assets to receive staking rewards without jeopardizing their tax status. Lastly, the bill provides clarity for taxpayers who engage in mining and staking of digital assets and helps maintain America’s leadership in the digital asset economy.
You can view Congressman Carey’s remarks in the Ways & Means Committee, here.
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