HR 10357: Digital Asset Tax Certainty Act

HR 10357 in plain English: This bill establishes tax rules for digital assets (such as cryptocurrencies), creating exemptions and definitions for small transactions, setting thresholds for when certain assets and fees are subject to reporting or taxation, and defining penalty structures for tax violations involving digital assets.

Stated purpose

The bill aims to reform how digital assets are taxed under the U.S. tax code, creating clearer rules for everyday transactions, bringing digital asset tax treatment in line with traditional financial assets, and reducing compliance burdens for owners and users of digital assets.

Key points

• Exempts small digital asset transactions where network or transaction fees do not exceed $10
• Sets a $5,000,000 annual threshold related to certain digital asset classifications
• Caps penalties for digital asset tax violations at $25,000 per taxable year, with 40% rate above that amount
• Raises penalty cap to $100,000 for certified eligible taxpayers
• Defines 'widely traded' digital assets partly by a $500,000,000 market capitalization threshold, adjusted for inflation after 2027

Arguments supporters make

• Current tax law treats even tiny digital asset transaction fees as taxable events, making everyday use of crypto impractical; this bill removes that barrier and lets digital assets function like ordinary money.
• Bringing digital asset tax rules in line with traditional financial assets creates fairness — crypto investors should face the same rules as stock or bond investors, not stricter or more confusing ones.
• Clear, codified rules reduce guesswork for taxpayers and the IRS alike, encouraging compliance and cutting down on costly disputes over how to report digital asset activity.

Arguments opponents make

• Reducing tax friction on digital asset transactions could make it easier to avoid reporting gains, shrinking tax revenue and shifting the burden onto other taxpayers.
• Applying traditional financial asset rules to digital assets may not fit well — crypto markets operate differently, and borrowing those rules could create new loopholes or unintended benefits for wealthy investors.
• A voluntary disclosure program and simplified rules may not be enough to close existing compliance gaps; critics argue stronger enforcement, not lighter rules, is what the IRS actually needs.

Tradeoffs

Making digital assets easier and cheaper to use day-to-day — by reducing small tax burdens — means some taxable gains go uncollected, trading tax revenue for broader adoption and simpler compliance. Giving digital assets parity with traditional financial assets benefits holders and industry participants but may reduce safeguards that currently limit tax avoidance strategies available in the crypto space.

Current status in Congress: In committee.

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