Two US senators, Cynthia Lummis and Bernie Moreno, have formally requested Treasury Secretary Scott Bessent to revise the interpretation of tax provisions affecting corporate digital asset holdings. In a letter dated May 12, 2025, they urged the Treasury Department to exercise its authority to amend the definition of "adjusted financial statement income" (AFSI) under the corporate alternative minimum tax (CAMT) rules, stemming from the Inflation Reduction Act of 2022.
The senators highlighted concerns that current regulations would tax unrealized gains on digital assets, forcing US companies to potentially liquidate holdings to meet tax liabilities and disadvantaging them against foreign competitors governed by different accounting standards. They argue such an outcome was unintended by Congress.
Lummis, known for her strong advocacy of digital assets, and Moreno, supported by crypto political action committees, suggest regulatory guidance excluding unrealized gains on digital assets from AFSI calculations. They pointed to prior IRS relief measures for the insurance industry as precedent for such intervention.
The appeal is set against a backdrop of stalled Senate legislation concerning stablecoin regulation, including the GENIUS Act. The Cedar Innovation Foundation, a crypto-focused political action committee underpinning Fairshake, further advocated for swift passage of stablecoin legislation to sustain US innovation and competitiveness in digital finance.
With the Inflation Reduction Act imposing a 15% minimum tax on sizable corporate profits but now applying mark-to-market accounting standards to digital assets, US firms face significant tax liabilities on unrealized cryptocurrency gains. The senators' intervention aims to clarify and modify these provisions to prevent unwarranted tax burdens and to foster a more competitive environment for US-based digital asset enterprises.