House Ways and Means Committee Republicans consider dropping crypto tax provisions

House Republicans on the Ways and Means Committee are weighing whether to strip out provisions that would change how crypto mining and staking rewards are taxed, a move that could reshape one of the most consequential pieces of digital asset legislation currently moving through Congress.

The provisions in question come from H.R. 9175, the Tax Clarity for Mining and Staking Act, introduced on June 8, 2026, by Rep. Mike Carey (R-OH). The bill’s core idea is straightforward: let miners and stakers defer paying taxes on newly created crypto rewards until they actually sell the assets, rather than treating those rewards as taxable ordinary income the moment they hit a wallet.

Why the tax treatment matters

Under the IRS’s current framework, if you validate transactions on a blockchain and receive tokens as a reward, you owe income tax on the fair market value of those tokens at the time you receive them. Sell or don’t sell, the tax bill arrives regardless.

H.R. 9175 would fix this by pushing the taxable event to the point of sale, aligning the treatment more closely with how other property transactions work in the tax code.

The bipartisan math

The reason Republicans are considering dropping these provisions isn’t philosophical. It’s political arithmetic.

Committee Chair Jason Smith (R-MO) is reportedly trying to advance the less contentious elements of the broader tax package ahead of the upcoming midterm elections. The key figure in the calculation is Rep. Steven Horsford (D-NV), described as a significant Democratic supporter of crypto regulation. Securing his backing could give the package enough bipartisan credibility to survive the legislative gauntlet, but that support apparently comes at a cost: the mining and staking provisions.

Democrats on the committee raised concerns during a hearing on June 9, 2026, that offering a tax deferral privilege specifically for digital asset rewards could create an uneven playing field compared to traditional investments. That hearing featured testimony from Fidelity, Coinbase, and NYU Law’s Tax Law Center, all weighing in on how the tax structure shapes the crypto investment landscape.

Industry pushback is already underway

On June 21, 2026, a coalition of crypto industry groups sent a letter urging the committee to pass the bill without modifications. Their argument: stripping out the mining and staking provisions would actually hurt the chances of bipartisan support, not help them, because the provisions address a real policy problem that members on both sides of the aisle have acknowledged.

The markup is scheduled for September 16, 2026, which means the committee has roughly three months to sort out the internal dynamics.

For miners and stakers specifically, the stakes are concrete. Operations with significant capital expenditures on hardware and energy already run on thin margins. Adding a tax obligation on rewards before any liquidity event compounds the financial pressure, particularly during bear markets when the tokens received as rewards may be worth substantially less by the time they’re sold than when they were earned.

Fidelity’s presence at the June 9 hearing wasn’t accidental. Large financial institutions have been expanding their digital asset offerings, and the regulatory and tax framework surrounding those assets directly influences how aggressively they can move.

Whether Chair Smith can thread the needle—keeping enough provisions to satisfy the industry while trimming enough to bring Democrats along—will likely determine whether this Congress produces meaningful crypto tax legislation at all.

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