The US Senate Finance Committee is scheduled to hold a critical hearing next Wednesday to address taxation matters concerning digital assets.
Leading the discussion will be Finance Committee Chair Mike Crapo, featuring testimonies from key industry experts including Coinbase Vice President of Tax Lawrence Zlatkin and Coin Center Policy Director Jason Somensatto.
This session aligns with recommendations from the White House Digital Asset Working Group’s July report, which urged lawmakers to classify cryptocurrency as a unique asset class and adapt existing tax frameworks for securities and commodities to accommodate digital assets.
Absent new legislation, the report suggests the Treasury Department and the Internal Revenue Service (IRS) should issue clear guidance on the taxation of stablecoin payments and the treatment of small crypto amounts earned through airdrops, mining, and staking.
Currently, the IRS classifies cryptocurrencies and NFTs as property, not currency, subjecting transactions to capital gains tax upon profitable sales or transfers.
Significant progress in crypto regulation has been observed since January, aiming to foster innovation and retain industry talent, correcting delays seen during the previous administration when tax policies caused confusion.
Expert Testimonies from Tax Professionals
The committee will also hear from Annette Nellen, who leads the Digital Assets Tax Task Force at the American Institute of Certified Public Accountants, and Andrea S. Kramer, a specialist in crypto taxation and founding member of ASKramer Law.
Senator Pushes to Prevent Double Taxation of Crypto Miners and Stakers
Senator Cynthia Lummis advocates ending what she calls unfair double taxation for crypto miners and stakers, who are taxed first when receiving block rewards and again upon selling those rewards.
Lummis has expressed her views publicly and attempted to include provisions addressing this issue in a recent budget reconciliation bill, although the changes did not make it to the final Senate floor amendments.
