On May 19, four members of the U.S. House Ways and Means Committee — Steven Horsford, Max Miller, Suzan DelBene, and Mike Carey — unveiled the PARITY Act (Digital Asset Protection, Accountability, Regulation, Innovation, Taxation and Yields Act). The bill targets two frictions in crypto taxation: the phantom income issue on staking rewards and the capital gains burden on stablecoin payments.
Staking & Mining Tax Deferral Up to 5 Years
Under current IRS rules, staking and mining rewards are taxable upon receipt, even if the tokens are never sold. The PARITY Act lets taxpayers defer recognition for up to five years, or until disposal (whichever comes first), treating the proceeds as ordinary income. This eliminates the cash-flow problem that forces some holders to sell tokens just to pay taxes.
$200 Stablecoin Transaction Exemption
For compliant stablecoins under the GENIUS Act, the bill exempts transactions of $200 or less from capital gains tax. It also sets a strict pegging standard: the stablecoin must trade within $1.00 ±1% for at least 95% of trading days over the prior 12 months. The exemption is aimed at everyday payments, not large or speculative trades.
Wash Sale Rule Extended to Crypto
Not all provisions ease the tax burden. The PARITY Act applies the 30-day wash sale rule to digital assets — losses from a sale cannot be claimed if substantially identical assets are repurchased within 30 days. Previously, crypto was exempt from this rule, a gap now targeted for closure.
Bipartisan Path and Tight Timeline
Ways and Means Chairman Jason Smith (R-MO) said the bill will advance only with bipartisan support. He noted the legislative pace is already aligned. Horsford described the act as a “durable floor,” not a temporary fix. Miller set a deadline of August 2026 to avoid slipping past the next election cycle. Industry feedback is mixed: Crypto Council for Innovation voiced support in a letter, while the Blockchain Association warned some language could “undermine carefully negotiated compromises and compress competitive space.”