Lawmakers Drop Bombshell PARITY Act for Crypto Taxes

Bipartisan PARITY Act reforms crypto taxes, adding a 200-stablecoin exemption, a wash sale crackdown, and a five-year deferral on tax on staking digital assets.

A universal crypto-tax plan was announced by bipartisan legislators. On December 20, 2025, Representatives Max Miller and Steven Horsford proposed the Digital Asset PARITY Act.

Congressman Max on X has released the working draft, according to him, with Representative Horsford. The Republican legislator claimed that the bill would bring sanity and equality to crypto taxation. 

Source – Max 

Miller underscored the fact that it not only safeguards consumers who make daily purchases but also establishes straightforward guidelines to innovators and investors.

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Stablecoin Safe Harbor Transforms Daily Transactions

The law creates a de minimis exemption of 200 regulated payments of stablecoins. Stablecoins should be issued by licensed issuers who are required to comply with the GENIUS Act, and qualifying tokens must remain within 1 00 of $1.00.

In this provision, digital dollars are treated as cash, and this is meant to minimize the administrative load of the IRS. The exemption does not apply to brokers and dealers.

Horsford justified the decision on X and in official documents. He pointed out that the slightest crypto transaction provokes tax calculations nowadays. The Nevada Democrat added that the draft has a leveling effect on the playing field between the consumers and the businesses.

Wash Sale Loophole Faces Complete Elimination

The bill imposes constructive-sale and wash-sale to digital assets. The 30-day period before traders can buy the same or substantially similar assets to revise any loss is similar to the current stock-market regulations.

The reform could bring in billions of federal revenues. The existing regulations classify crypto as an asset as opposed to a security, and over the years, investors have taken advantage of the loophole.

Miller mentioned that the bipartisan legislation introduces fairness to the taxation of digital assets. He emphasized that it enhances conformity as all the people are guided by the same rules. The Ohio congressman commented that the tax code in America has not kept up with current financial technology.

Five-Year Tax Deferral Solves Phantom Income Problem

The PARITY Act provides a middle ground in the way staking and mining rewards are made. Taxpayers can also choose not to collect taxes on reward income within a period of 5 years, responding to industry grievances concerning phantom-income taxation.

Presently, IRS regulations tax rewards as they are received. The new structure permits the postponement of the sale or the conversion of the reward. Mark-to-market accounting can also be chosen by professional traders.

The bill modernizes the rules of charitable contributions on digital assets. It makes clear that passive protocol-level investment fund staking is not a trade or business. The majority of provisions shall be effective on the 2026 tax year.

The draft was circulated to the stakeholders by the representatives Miller and Horsford. They emphasized on cooperation with tax professionals and sector leaders. The legislators strive to come up with tax regimes that capture the changing role of digital assets.

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