US Representatives Max Miller and Steven Horsford on Thursday released a discussion draft titled the “Digital Asset Protection, Accountability, Regulation, Innovation, Taxation, and Yields Act” (Digital Asset PARITY Act) proposing an overhaul of the Internal Revenue Code to clarify tax treatment for digital assets.
The draft says stablecoins would not trigger gains if their cost basis—the amount paid by the investor—does not fluctuate by more than 1% of $1 (or $0.01). Transaction costs incurred to acquire or move regulated dollar‑pegged stablecoins would not be included in an investor’s cost basis, the bill states.
The proposal introduces a de minimis tax exemption for stablecoin transactions below $200, meaning such transactions would not create tax or reporting obligations; a total annual exemption cap has not been set. Income from lending, staking, or “passive” validator services would be included in recipients’ gross income annually, calculated at fair market value.
The Digital Asset PARITY Act is currently a discussion draft intended to spur debate among lawmakers, stakeholders and the crypto industry and has not been formally introduced in Congress.
Reactions highlighted divisions within the crypto community. Cody Carbone, CEO of the advocacy group Digital Chamber, said tax clarity is needed to encourage onshoring of digital asset activity. Bitcoin advocates have criticized the draft for applying a de minimis exemption only to stablecoins and not to Bitcoin—mirroring concerns about other pending legislation such as the CLARITY market-structure bill. Pierre Rochard, CEO of The Bitcoin Bond Company, called the approach “the wrong direction,” arguing Bitcoin should receive a de minimis exemption and saying stablecoins are neither decentralized nor permissionless.
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