U.S. Rep. Drew Ferguson (R-GA), alongside Rep. Wiley Nickel (D-NC), introduced new legislation intended to address confusion within the tax code regarding how digital assets rewards can be collected at the point of sale. 

The bill, HR8149, is titled the Providing Tax Clarity for Digital Assets Act. The legislation clarifies language in the tax code to show that digital asset rewards are collected at the point of sale. It also defines “staking rewards” as “created property” in regards to taxes. 

The bill would also prevent any possibilities of double taxation situations on such assets. This clarification was especially intended to encourage “more companies to stay in the United States and [increase] the U.S. revenue base,” according to a release from Ferguson. 

“The United States has long been the leader in innovation and technology yet is falling behind our foreign counterparts in providing tax clarity for the emerging digital asset industry,” Ferguson said. “The United States’ treatment of digital asset rewards is overly complex – leading to confusion by investors, double taxation, and American businesses relocating overseas. The Providing Tax Clarity for Digital Assets Act would give the industry desperately wanted tax clarity, establish United States leadership in digital asset tax treatment, and encourages innovation and business in the United States.”

“I’m proud to introduce the Providing Tax Clarity for Digital Assets Act with Rep. Ferguson to provide clear guidance on the taxation of digital assets in the United States,” Nickel said. “This is a critical first step that will help spur innovation, ensure investor confidence, and discourage American businesses from relocating overseas.”

The changes within this bill, if approved, would take effect for all “taxable years beginning after December 31, 2023.”