Congressman Max Miller Releases Bipartisan Legislation to Modernize Tax Treatment of Digital Assets

WASHINGTON, D.C. – U.S. Congressman Max Miller (OH-07) and Congressman Steven Horsford (NV-04) released bipartisan draft legislation to modernize the federal tax code for digital assets, providing long-overdue clarity and parity for consumers, investors, and businesses while strengthening tax compliance and protecting the integrity of U.S. markets.

“America’s tax code has failed to keep pace with modern financial technology,” said Congressman Miller. “This bipartisan legislation brings clarity, parity, fairness, and common sense to the taxation of digital assets. It protects consumers making everyday purchases, ensures the rules are clear for innovators and investors, and strengthens compliance so everyone plays by the same rules.” 

“Like any emerging technology, cryptocurrencies need guardrails that allow innovation to grow while protecting taxpayers and the integrity of our tax system,” saidCongressman Horsford. “Today, even the smallest crypto transaction can trigger tax calculation, while other areas of the law lack clarity and invite abuse. Our discussion draft of the Digital Asset PARITY Act takes a targeted approach that provides an even playing field for consumers and businesses alike to benefit from this new form of payment.”

The draft legislation reflects bipartisan agreement on core policy objectives and provides the Treasury with targeted regulatory authority to prevent abuse while reducing unnecessary administrative burdens on taxpayers. 

Among its key provisions, the bill:  

• Establishes a commonsense tax treatment for regulated payment stablecoins and ensures everyday payment transactions do not trigger unnecessary tax reporting.  
• Clarifies source-of-income rules for digital asset trading, providing certainty for U.S. and foreign market participants while maintaining strong tax enforcement standards. 
• Extends existing securities-lending tax rules to digital assets, ensuring that bona fide digital asset lending is not treated as a taxable sale. 
• Applies wash-sale and constructive-sale rules to digital assets, closing loopholes that allow taxpayers to artificially harvest losses or defer gains. 
• Allows mark-to-market elections for digital asset traders and dealers, aligning tax treatment with established financial market practices. 
• Creates an elective framework for staking and mining rewards, treating rewards as income while allowing deferral of taxation to address liquidity and phantom income concerns. 
• Modernizes charitable contribution rules, distinguishing between highly liquid digital assets and speculative or illiquid tokens to prevent abuse while supporting legitimate charitable giving.

Draft text here.