House Crypto Tax Bill Adds Wash Sales After Senate Stall

The House Ways and Means Committee voted 38-5 on September 16 to send the Digital Asset Tax Certainty Act to the floor. H.R. 10357 would apply wash-sale rules to traded crypto and drop gain-or-loss accounting on some network fees of $10 or less.

The vote came a day after the Senate refused, 49-50, to take up the separate Clarity Act. Crypto traders can still sell a coin at a loss and buy it back the same afternoon. This bill would end that, while the market-structure law the industry wanted remains stuck.

Ways and Means Clears a Crypto Tax Bill 38-5

Chairman Jason Smith, a Missouri Republican, introduced the package on September 14 with eight cosponsors, including Rep. Steven Horsford of Nevada, the lone Democrat on the original list. Two days later the committee adopted Smith’s substitute by voice vote and ordered the bill reported as amended.

Smith had spent more than a year insisting the tax rewrite would move only with Democratic votes. The 38-5 tally gave him that, even as Rep. Lloyd Doggett of Texas lost two amendments, 12-28 and 16-25.

This is a historic moment for this Committee: after more than a year of working together, Republican and Democrat Members have come together to establish the first-ever tax framework for digital assets.

Jason Smith, Ways and Means chairman, September 16 markup

In a statement after the vote, Smith said the bill would be the first federal law on the substance of crypto tax and would reach more than 67 million people, a group he put at one in four Americans. He put the digital-asset economy at $2 trillion. At a June 9 hearing he had said ownership was 3 percent at the start of the decade.

Rep. Mike Kelly of Pennsylvania, who chairs the tax subcommittee and co-led the bill, said it writes rules of the road for taxation and enforcement without granting special treatment. That line is the tell. The text borrows stock-and-securities rules more than it carves crypto out of them.

The $10 Break Covers Fees, Not Purchases

Under IRS Notice 2014-21, virtual currency is property. Paying a bitcoin gas fee can be a taxable sale even when the fee is a few cents, which is why wallets throw off lots that no one would track for a credit-card swipe.

The bill says there is no gain or loss on qualifying fees of $10 or less, covering network validation costs and certain brokerage, trading, and liquidity charges that move a transfer. It is not a $10 holiday for buying coffee with bitcoin. Ordinary purchases stay property sales.

The relief would apply to dispositions after December 31, 2027, so the first year it would show up on a return is 2028. Simplified annual accounting for widely traded tokens is on the same clock.

WHO CANNOT USE THE $10 FEE BREAK

• High-volume wallets: Anyone with more than 5,000 digital-asset transfers in the prior year is out.
• Market professionals: Traders, brokers, and dealers do not get the exception, pending any Treasury guidance.
• Validators’ businesses: Firms that facilitate transaction validation are carved out on the same basis.

Qualifying U.S. dollar stablecoins would get a separate basis rule so tiny moves around the $1 peg do not mint a capital gain on every payment. Traders, brokers, dealers, and users above the 5,000-transfer line are excluded there too. Lending rules would treat some crypto loans like securities loans, so a temporary transfer that meets the bill’s tests would not count as a sale.

Wash Sales Would End Crypto Loss Harvesting

Section 1091 already blocks a stock investor from claiming a loss if a substantially identical security is bought in the 30 days before or after the sale. Crypto sits outside that statute because the IRS calls it property, not a security. Selling bitcoin at a loss and buying it back an hour later is still a good loss on a 2026 return.

H.R. 10357 would extend wash-sale and constructive-sale rules to traded digital assets and to some economically equivalent products, including wrapped and tokenized versions. Qualifying U.S. dollar stablecoins would stay out. The 30-day window that stock traders already live with would finally sit on bitcoin, ether, and the rest of the liquid tape.

That is the provision on-chain desks should price, not the $10 fee line. A trader who dumps a losing coin, rotates into another token, then buys the first coin back inside 30 days would see the loss parked. Gains on the second leg would still be taxed. The Joint Committee on Taxation treats the change as a raiser, which is how a “relief” bill still adds receipts.

Broker reporting would be tightened in the same title, and Treasury would have to stand up a voluntary disclosure program for people who want to fix old digital-asset returns, pay tax and interest, and seek penalty relief. Parity, in this draft, means the IRS gets the same anti-abuse tools it has on equities.

No Sale Deferral for Mining Rewards

June’s standalone mining-and-staking bill would have let some validators defer tax until they sold the coins they created. That election is not in the markup vehicle. Title IV of H.R. 10357 would set sourcing rules and treat validation income as ordinary income, leaving in place the current timing that generally taxes rewards when the taxpayer has control of them.

An investment trust could stake coins without automatically losing its tax status, a narrow fix aimed at products that want yield inside a fund wrapper. Individual miners and stakers do not get a sale-based delay. Charitable gifts of certain digital assets would be easier to deduct, which is one of the few holder-friendly lines that survived consolidation.

The dropped deferral is why some industry groups can clap for “certainty” and still walk out with a tax acceleration. Ordinary-income treatment on rewards, plus wash sales on the liquid coins those rewards are often swapped into, is a stiffer stack than the June hearing teasers implied.

Why the Senate Vote Failed 49-50

The Digital Asset Market Clarity Act, H.R. 3633, is the market-structure bill that would split oversight between the SEC and the CFTC. The House passed it in July 2025. On September 15 the Senate held a cloture vote on the motion to proceed, which needed 60 votes to open debate.

The Senate Daily Press records that cloture failed by a 49-50 vote at 3:00 p.m., after voting began at 2:18 p.m. All 49 yes votes were Republican. Sens. Susan Collins of Maine, Josh Hawley of Missouri, and Jerry Moran of Kansas voted no. Sen. Thom Tillis of North Carolina also voted no so he could move to reconsider, which he did at 3:01 p.m. Sen. Chris Coons of Delaware did not vote. No Democrat voted to take the bill up. The motion fell 11 votes short of 60.

HOW THE TAX BILL AND CLARITY DIVERGED

1. June 9, 2026: Ways and Means holds its digital-asset tax hearing on seven Republican drafts, including wash sales and a mining deferral.
2. September 14, 2026: Smith introduces H.R. 10357 as the consolidated tax package.
3. September 15, 2026: Senate cloture on Clarity fails 49-50; Tillis files a motion to reconsider.
4. September 16, 2026: Ways and Means reports the tax bill 38-5.

The Blockchain Association had already framed tax as the missing third piece, next to market structure and the GENIUS stablecoin law, in a post the morning of the Senate vote.

1/ Digital asset tax legislation is the critical third leg of the stool for crypto policy, alongside market structure and stablecoin rules.

Tomorrow, @WaysandMeansGOP Chairman @RepJasonSmith will lead a markup of the Digital Asset Tax Certainty Act.https://t.co/PONhxkVF9z

— Blockchain Association (@BlockchainAssn) September 15, 2026

Market structure is the bill that tells a protocol whether it is a commodity, a security, or something else. The tax bill tells the IRS how to score the same tokens while that fight is unfinished. People who wanted a rulebook for exchanges got a rulebook for Form 8949 instead, and that split is already obvious to anyone watching both chambers.

The Score Puts the Cost on Traders

The staff of the Joint Committee on Taxation published estimated revenue effects of the bill ahead of the markup. The net for fiscal years 2027 through 2036 is about $500 million more for the Treasury. That small headline hides a swap: fee relief is expensive, and trading rules pay for it.

JCT REVENUE ESTIMATES, 2027 THROUGH 2036

Wash sales and mark-to-market together are scored at more than $4 billion. Other lines, including stablecoin basis, lending, charitable gifts, and simplified accounting, sit between those raisers and the net, so the four rows do not add to about $500 million on their own. The direction is still clear. The money comes from people who trade, not from people who pay a $9 gas fee once a month.

Mark-to-market would be opened more widely to digital-asset dealers and to traders whose activity rises to a trade or business, aligning them with securities dealers who already mark positions each year. For a desk that already runs like a dealer, that can be a cleaner annual close. For a high-turnover retail wallet that does not want dealer status, wash sales arrive without that option.

September Leaves Little Floor Time

Committee passage is not a House vote, and a House vote would still leave the Senate and the White House. Clarity is not dead on paper because Tillis’s motion to reconsider sits on the calendar, but the same chamber that could not find 60 votes on September 15 would have to find them in a short September and early-October window before members leave to campaign.

The tax bill has a friendlier math problem, a simple majority in the House, and a 38-5 committee result that Democrats could defend in a midterm year. It also has a delayed effective date on the popular fee line and an immediate political fight over wash sales, which are easy to sell as fairness in a hearing room and easy to hate in a Telegram trading chat.

Smith still wants the United States billed as the crypto capital of the world. The week’s record is more specific than that slogan. The tax-writing committee can report a digital-asset code. The Senate, for now, will not open a digital-asset market law. Tillis’s motion remains on the calendar, and H.R. 10357 is at the House, still unscheduled for the floor.

Disclaimer: This article is news reporting and analysis of pending U.S. tax legislation, offered for information only. It is not tax, investment, or legal advice and does not tell readers how to file, trade, harvest losses, or treat mining or staking rewards. Anyone who holds digital assets should consult a qualified tax professional or enrolled agent about their own facts before changing a return or a trading method. Vote counts, effective dates, and Joint Committee on Taxation figures reflect the sources cited for the committee markup and may change if the House, Senate, or Treasury revises the text.