PANews reported on May 14 that according to The Block, U.S. Republican Senators Cynthia Lummis and Bernie Moreno jointly wrote to the Treasury Secretary, requesting clarification on the tax treatment of unrealized gains from digital assets. The senators pointed out that the current Corporate Alternative Minimum Tax (CAMT) conflicts with the new mark-to-market rules from the Financial Accounting Standards Board (FASB), which could potentially lead to companies paying taxes on unrealized crypto asset appreciation.
According to the 2022 Inflation Reduction Act, companies with an average annual revenue exceeding $1 billion over three consecutive years are required to pay a 15% minimum tax. The new FASB rules require companies to measure digital assets at market value, which while improving financial statements for companies like MicroStrategy that hold Bitcoin, also introduces potential tax liabilities on unrealized gains. Cynthia Lummis and Bernie Moreno warned that without clear exemption guidelines, companies might be forced to sell digital assets to pay taxes, which would suppress industry innovation. They requested that the Treasury Department quickly develop a transitional solution, referencing the tax-free policy for unrealized stock gains. The Treasury Department has not yet publicly responded to this matter.
