- Senator Cynthia/Lummis has introduced a standalone bill establishing a $300 de/minimis crypto tax exemption
- Lummis has capped the annual exempt gain at $5,000 and tied thresholds to inflation from 2026
- The bill also defers taxation on mining and staking rewards and aligns crypto lending rules with securities lending provisions
Senator Lummis has drafted legislation that would exempt cryptocurrency transactions under $300 from capital gains tax, with an annual cap of $5,000 and inflation indexing starting in 2026. In addition, the bill restructures tax treatment so that mining and staking rewards are only taxed upon sale, and it brings crypto lending under a tax regime similar to that for securities lending. The proposal marks a renewed effort to simplify crypto taxation after initially failing to be included in Donald Trumps One Big Beautiful Bill.
Lummis Hopes to Bring Clarity to Everyday Crypto Use
One of the major hurdles with mainstream crypto adoption when it comes to using it as a form of cash is that of tax; whereas dollars can be spent without fear of taxation, spending crypto carries with it the burden of having to calculate if youve gained financially from the transaction. Not to be perturbed having failed to get the exemption added into Trumps One Big Beautiful Bill, crypto advocate Lummis has introduced separate legislation to push through her plans, which are designed to remove this tax friction from everyday digitalasset use.
As well as forgiving crypto users from such taxation burdens for a small amount of crypto, a major provision defers the income tax on mining and staking rewards until the assets are sold, rather than taxing them at receipt, a policy shift many in the crypto space have requested. Currently, crypto earnings are treated as income at the time of arrival and then as a form of capital from that point.
The bill goes further by introducing a marktomarket option for dealers, washsale rules for crypto, and clearer rules around charitable donations, all of which Lummis hopes will encourage crypto usage by those involved in all aspects of the crypto space.
Broader Technical Fixes
Following Thursdays passing of Trumps mega-bill, Lummis promptly released the standalone bill, describing it as fully paidfor, cuts through bureaucratic red tape, and establishes commonsense rules that reflect how digital technologies function in the real world.
This initiative signifies a turning point in how Washington approaches cryptocurrency taxation; by reducing burdens on small transactions and clarifying treatment of more complex crypto activities, Lummiss bill could reshape the digitalasset landscape. However, with a packed Senate agenda and competing crypto marketstructure legislation in the pipeline, lawmakers say its journey through committees and onto the Senate floor could be challenging.
