Lummis Goes Solo: Wyoming Senator Unveils Crypto-Tax Overhaul After Budget-Bill Snub

What’s in the bill? Pain point Lummis fix Every cappuccino is a taxable nightmare Creates a de minimis exclusion: gains on transactions ≤ $300 are ignored, up to $5 000 total per year, indexed for inflation from 2026.  Block-reward “phantom income” Taxes on mining & staking rewards are deferred until the coins are sold, ending the “tax now, cash later” problem that forced some miners to dump holdings in bear markets.  Lending is not a sale Extends the long-standing securities-lending safe harbor (IRC § 1058) to digital assets, so parking your SOL on Aave won’t trigger capital gains.  Wash-sale loophole Applies the 30-day wash-sale rule to crypto, killing the “sell-ETH-for-a-tax-loss-and-buy-it-back-ten-seconds-later” strategy.  Dealer parity Lets full-time traders elect mark-to-market accounting, just like equities desks. Charitable giving red tape Treats liquid tokens like publicly traded stock, waiving pricey appraisals for donations. 

The Joint Committee on Taxation pegs the package at positive $600 million over ten years — proof, Lummis boasts, that “common-sense reform doesn’t have to blow a hole in the deficit.”

Page 1 of the Bill, Source: Lummis

Why it matters

For U.S. users, every sat spent on groceries currently demands a capital-gain calculation. That’s insane for a network that can split a Bitcoin into 100 million units. The bill’s $300 buffer borrows from the existing foreign-currency exemption, acknowledging that nobody tracks penny-level FX gains when they swipe a Visa in Paris. 

On the mining side, the change lines up with Jarrett v. United States, the high-profile Sixth Circuit case arguing that newly minted tokens shouldn’t be taxed until sold — a position championed by Coin Center since 2021. 

How we got here

Lummis tried to slip similar language into Trump’s must-pass budget juggernaut last week. In a marathon vote-a-rama, the crypto pieces were jettisoned, leaving lobbyists fuming and the senator promising a “Plan B.” Today’s filing is that Plan B. 

Early reaction

• Industry groups are ecstatic. The Blockchain Association calls the de minimis rule “a prerequisite for crypto to function as electronic cash.”

• Tax nerds give cautious thumbs-up. KPMG’s crypto-lead points out that wash-sale parity removes an “unfair advantage” critics of the asset class love to highlight.

• Hardline deficit hawks scoff at the $600 million pay-for, calling it “decimal-dust” in a $7 trillion budget.

Road ahead

The bill heads to the Senate Finance Committee, where Chair Ron Wyden (D-Ore.) has hinted at holding a hearing on “modernizing digital-asset taxation” before the August recess. Meanwhile, the House is hashing out the Digital Asset Market Clarity Act — meaning conference-room brinkmanship is inevitable if either chamber moves first.

Lummis wants public comment: her office posted the draft PDF and invited suggestions on X. 

The contrarian take

Cutting red tape is great, but let’s not pretend a $300 threshold turns Bitcoin into Apple Pay overnight. The real friction isn’t the tax line item — it’s clunky UX, slow settlement, and merchants who’d rather not gamble on price swings. And by extending wash-sale rules, Congress is about to discover whether the IRS can even track wallet hopping across thousands of DEXs. Spoiler: it can’t.

Still, deferring block-reward income is a rare alignment of tax logic and technological reality. If Washington doesn’t seize this low-hanging fruit, miners will keep relocating to friendlier jurisdictions — and the IRS will continue chasing phantom gains it never collects.

In other words, the Senate finally has a bill that marries revenue, rationale, and innovation. Now it just has to get it through… the Senate.