U.S. House PARITY Act pitched as crypto tax baseline as Senate CLARITY talks stall

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PARITY Act as crypto tax baseline

Highlights

The bipartisan PARITY Act, revised on March 26 by Representatives Horsford and Miller, proposes incremental crypto tax reforms amid stalled Senate CLARITY Act talks.
Key PARITY Act provisions include a cost-basis test for stablecoins, five-year tax-deferral for staking/mining rewards, and extending wash-sale rules to digital assets.
Horsford notes bipartisan interest but cautions that early inclusion of retirement account access for crypto could cause unintended consequences, with no set timeline for passage.

Tax framework and legislative positioning

As reported by CoinDesk, Horsford told attendees at the Consensus Miami conference on Tuesday that the bipartisan PARITY Act offers an incremental approach while Senate discussions on the CLARITY Act remain stalled.

The Nevada Democrat said the bill is designed to resolve tax treatment questions within the scope of existing tax law, with the aim of improving protections for consumers, small businesses and digital asset holders. Speaking with moderator Yesha Yadav, he argues that a narrower measure is preferable to broader proposals because sweeping legislation can combine useful provisions with definitions that create new problems.

Horsford co-authored the PARITY Act discussion draft with Republican Representative Max Miller of Ohio in December and revised it on March 26. The measure's main provisions include a cost-basis test for stablecoin payments, a five-year tax-deferral election for staking and mining rewards, and an extension of wash-sale rules to digital assets.

Implications for crypto policy and investors

Horsford says the current draft does not include access to digital assets through retirement accounts, though he adds that he personally wants to see that element addressed because of its potential role in retirement planning and wealth building. He also says there is genuine bipartisan interest in working on the issue, but warns that inserting language too quickly could produce unintended consequences.

On the broader policy outlook, Horsford says Senate negotiations between Senators Thom Tillis and Angela Alsobrooks to advance the CLARITY Act appear to be on hold. Asked whether bipartisan crypto legislation could pass before the November midterms, he does not commit to a timetable and says the priority is to get the legislation right rather than move quickly.

Our earlier article on the Senate’s crypto market-structure push explained that the next steps hinge on whether the Senate Banking Committee can move a markup forward after months of delays. We noted that disagreements over issues such as stablecoin rewards, along with political and illicit-finance concerns, have slowed momentum—raising the risk that the midterm calendar makes a broad framework like the CLARITY Act harder to advance.

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