US Senator Pushes for Crypto Tax Changes, What Will Be the Impact?

Updated

May 15, 2025

Gambar US Senator Pushes for Crypto Tax Changes, What Will Be the Impact?

Jakarta, Pintu News – US Senators Cynthia Lummis and Bernie Moreno have submitted a proposal to the US Treasury Department to change the way crypto assets are taxed. They highlighted the problems posed by the Corporate Alternative Minimum Tax (CAMT) introduced in the Inflation Reduction Act of 2022.

CAMT imposes a minimum tax of 15% on corporations with adjusted average financial statement income (AFSI) of at least $1 billion over a three-year period. This proposal aims to exclude unrealized gains and losses from AFSI calculations in accounting for the fair value of digital assets. This is intended to prevent companies from facing crypto taxes based on temporary market price changes.

This move is in response to a rule issued by the Financial Accounting Standards Board (FASB), which requires companies to report digital assets at fair market value in their financial statements.

FASB Rules and Corporate Tax Exposure

Our edge in digital finance is at risk if U.S. companies are taxed more than foreign competitors. @berniemoreno & I urged the @USTreasury to lift an unintended tax burden on U.S. digital asset companies. To lead the world in digital assets, we need a level playing field.⬇️ pic.twitter.com/V7pwAUqRc4
— Senator Cynthia Lummis (@SenLummis) May 13, 2025

In late 2023, the FASB issued Accounting Standards Update 2023-08 which requires fair value reporting for digital assets under Generally Accepted Accounting Principles (GAAP). The move aims to increase transparency but inadvertently exposes companies to crypto tax liabilities under CAMT for unrealized gains.

Companies must now mark digital assets such as Bitcoin and Ethereum to market at the end of each quarter. They report losses on the balance sheet and record gains as revenue, even if the assets are not sold.

Senators Lummis and Moreno, in their proposal, requested that Treasury use its authority under sections 56A(c)(2), (15), and (16) to adjust the AFSI calculation. They urged that unrealized gains and losses related to digital assets be ignored when calculating CAMT liabilities.

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Crypto Industry Concerns and Precedents

According to Senators Cynthia Lummis and Bernie Moreno, the lack of clear rules could force US-based companies to liquidate their holdings to fulfill CAMT obligations.

These new requirements may cause businesses to move their activities to countries with more favorable tax systems. In addition, they emphasized that domestic companies face tax inequalities with foreign companies, as fair value accounting for crypto assets is not mandatory under international standards. In 2023, the IRS recognized this kind of problem, responding with Notice 2023-20 that provided temporary relief to the insurance sector under CAMT.

Amidst this tension, the leaders of the IRS Digital Assets Initiative, Seth Wilks and Raj Mukherjee, had dropped out before the launch of 1099-DA which raised concerns in the crypto industry. As a result, the Senators suggested that these events show why the Treasury Department must act immediately to prevent unwanted developments in the digital asset market.

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