Good news is coming for the crypto world: the IRS and Treasury are showing signs they will relax the 15% tax rule that would have applied to crypto giants under the Corporate Alternative Minimum Tax (CAMT). That is a big deal if you care about how companies — and maybe even you — are taxed on digital assets. Let me break it all down for you.
What is the 15% CAMT rule and how did it affect crypto?
Under the Inflation Reduction Act of 2022, Congress created a 15% minimum tax (CAMT) on what is called “Adjusted Financial Statement Income” (AFSI) for large corporations. That means even if a company had paper gains (unrealized gains), it might still owe tax.
For crypto firms, that was a scary prospect. Because accounting rules require some firms to mark their holdings at fair value, a surge in crypto prices would create large paper profits — even if no coins were sold. Those gains would then count toward AFSI and trigger the 15% CAMT. In simple terms, they could be taxed on money they never actually received.
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What change is the IRS proposing?
Now, the IRS and Treasury have issued interim guidance that gives crypto companies relief from that harsh outcome. The main change: under the guidance, digital asset firms can exclude unrealized gains and losses on crypto holdings from AFSI, meaning those paper gains will not automatically trigger the 15% tax.
That change restores some normalcy — it aligns crypto treatment more with how other assets are handled: you generally pay taxes when you realize gains (by selling or exchanging), not just because the value goes up.
It is still temporary and interim. The guidance is meant to reduce compliance burdens and provide clarity until final rules are published.
Which crypto companies gain the most from this change?
The ones with large crypto holdings, especially those holding Bitcoin as part of their treasury or balance sheet, benefit hugely. For example, MicroStrategy, known for its massive Bitcoin holdings, would have faced billions in CAMT liability if unrealized gains were taxed. This new guidance spares them that risk.
Other large crypto firms, exchanges, or institutional holders may also see big tax relief. If you follow crypto news, these moves reduce the pressure on companies to sell assets just to pay tax bills.
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What this means for smaller investors and the crypto market
You might wonder: does this affect you? Maybe indirectly. The relief makes the U.S. more attractive to crypto firms and investment. If big players feel safer, we may see more innovation, more listings, and more stability.
Also, by clearing tax uncertainty, more companies might stay in or move to the U.S. That could lead to better services, more competition, and more options for everyday crypto users.
What you should watch next
- Final rules: The interim guidance is temporary. Watch for permanent CAMT rules that might tweak things.
- Senate hearings and oversight: The Senate Finance Committee is already holding hearings on crypto taxation.
- IRS notices: The notices are part of the guidance that outline which parts of digital asset gains can be excluded.
- Accounting standards impact: How firms implement fair value accounting will matter. The guidance says exclusion depends on how digital assets are treated under accounting principles.
- What counts as “unrealized” — companies will need to be careful and clear about which gains are excluded and which are realized gains.
This shift in the IRS’s stance could be a turning point for crypto-friendly policy in the U.S. If you are watching this space, now is the time to stay alert — the rules are changing, and they may benefit more players than you expect.
