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\n\t\t\t\t\t\t\t\t\tThe exchange argued that tracking gains on stablecoin purchases creates administrative complexity without generating meaningful tax revenue.\t\t\t\t\t\t\t\t<\/p>\n<\/p><\/div>\n
Coinbase\u2019s vice president of tax, Lawrence Zlatkin, testified before the House Ways and Means Committee on June 9, asking lawmakers to stop requiring Americans to calculate capital gains every time they spend a stablecoin or pay a blockchain transaction fee.<\/p>\n
His testimony came during a hearing on six standalone bills aimed at updating how the US tax code treats digital assets, covering everything from mining and staking taxation to charitable donations and broker reporting requirements.<\/p>\n
Ahead of the hearing, the House Ways and Means Committee said it would examine legislation designed to bring \u201cclarity, parity, and administrability\u201d to digital assets.\u00a0Representing Coinbase, Zlatkin told<\/a> legislators that the current tax rules force consumers to track tiny gains and losses on routine transactions involving crypto.<\/p>\n According to him, federally regulated stablecoins pegged to the US dollar should be treated at par for tax purposes because they are designed to maintain a one-to-one value with the greenback.<\/p>\n He also argued that asking users to calculate cost basis every time they spend a stablecoin only created paperwork without generating any meaningful tax revenue.\u00a0Furthermore, Zlatkin backed a proposal by Congressman Rudy Yakym to waive tax reporting on gas fees of up to $10.<\/p>\n He also asked Congress to create a broader de minimis exemption for small crypto purchases. Under Coinbase\u2019s proposal, people making low-value transactions with Bitcoin (BTC) or other non-stablecoin cryptocurrencies would not have to calculate taxable gains every time they bought something.<\/p>\n Recall that in March this year, Coinbase CEO Brian Armstrong faced accusations<\/a> of lobbying against a BTC tax exemption. At the time, he called the claims \u201ctotally false\u201d and said that he had personally spent time advocating for a Bitcoin de minimis rule.<\/p>\n On mining and staking, the exchange supported a bill by Congressman Mike Carey that, if passed, would let validators defer tax on block rewards until those assets are actually sold instead of when they are received.<\/p>\n \u201cA farmer is never taxed when a bushel of wheat sprouts from the ground; they are taxed when they harvest that crop, bring it to market, and execute a sale,\u201d Zlatkin explained.<\/p>\n<\/blockquote>\n Lastly, the executive reiterated Coinbase\u2019s view on wash-sale rules, which prevent investors from claiming a tax loss if they buy back the same asset within 30 days of selling it.<\/p>\n While the firm has long agreed that the rules should also apply to crypto, it flagged a practical problem: that crypto trades 24 hours a day across exchanges, liquidity pools, and self-custody wallets, all at the same time, and there currently is no shared data architecture that would let anyone track wash-sale violations across that broken environment in real time.<\/p>\n According to the tax guru, before the rules take effect after being enacted, there should be an implementation runway of at least 18 to 24 months to allow for necessary software infrastructure to be built. He warned that forcing immediate compliance would lead to widespread reporting errors and a flood of IRS audits.<\/p>\n LIMITED OFFER for CryptoPotato readers at Bybit: Use this link<\/a> to register and open a $500 FREE position on any coin!<\/b><\/p>\n<\/div>\n<\/div>\nYou may also like:<\/h3>\n
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The Wash-Sale Question<\/h2>\n
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