US crypto industry organizations jointly send letter to Congress in support of the bill to clarify mining and staking taxation

Foresight News reports that Blockchain Association, Crypto Council for Innovation, and The Digital Chamber—three organizations in the crypto and blockchain industry—have jointly sent a letter to the Chairman of the US House Ways and Means Committee, Jason Smith, and the Ranking Member, Richard Neal, urging support for the mining and staking tax clarity bill, The Tax Clarity for Mining and Staking Act (H.R. 9175), which was introduced by Representative Mike Carey, and calling for its passage in its original form.

The letter points out that since the inception of Bitcoin, miners and stakers have long lacked clarity in tax law regarding the timing, source, and nature of taxation for mining and staking rewards. The Internal Revenue Service (IRS) issued a notice in 2014 requiring miners to include the fair market value of mined Bitcoin as gross income; in 2023, a tax ruling classified staking validation rewards as immediate taxable income for stakers. Currently, the value of assets secured through Proof of Stake (PoS) and Proof of Work (PoW) mechanisms exceeds $1.7 trillion.

The letter states that the bill draws on century-old tax principles for newly created property, making substantial concessions in the nature and timing of taxation to ensure that income is ultimately recognized and taxed, while preventing taxpayers from being forced to pay taxes before assets can be liquidated, thereby avoiding forced sell-offs. The signatory organizations believe that, compared to the alternative proposal that sets a mandatory five-year recognition cycle (which, according to estimates by the Joint Committee on Taxation, would bring negligible additional tax revenue but significantly increase compliance burdens for taxpayers, tax advisors, and the IRS), this bill can achieve the same tax objectives at a lower administrative cost. The three organizations urge Congress to retain the bill’s current balanced approach and pass it as originally proposed.