US Senators Push for Tax Relief on Corporate Crypto Holdings, Urge Treasury to Amend Key Definition

Two U.S. senators are urging the Treasury Department to revise a key tax provision that could significantly impact companies holding digital assets. In a letter dated May 12, Senators Cynthia Lummis and Bernie Moreno called on Treasury Secretary Scott Bessent to use the department’s existing authority to amend the definition of “adjusted financial statement income” under the Inflation Reduction Act.

The senators argue that the current definition could lead to excessive taxation of corporate digital asset holdings, including unrealized crypto gains and losses. The Inflation Reduction Act, enacted in 2022 and effective since 2023, includes a 15% minimum corporate tax on firms with profits exceeding $1 billion for three consecutive years. Critics say this framework unfairly penalizes companies involved in digital finance, particularly in a highly volatile market.

May 12 letter to Treasury Secretary Scott Bessent. Source: Cynthia Lummis

“Our edge in digital finance is at risk if U.S. companies are taxed more than foreign competitors,” Lummis posted on X (formerly Twitter) on May 13. The senators’ proposed adjustment is aimed at offering relief to corporations that invest in or hold digital assets, and maintaining the global competitiveness of the U.S. crypto industry.

Lummis has long been an advocate for digital assets in Congress, and Moreno, newly elected in 2024 with significant support from crypto-aligned political action committees, is aligning with that stance.

The call to amend digital asset tax treatment comes as the Senate is also considering legislation on stablecoin regulation. The Guiding and Establishing National Innovation for US Stablecoins Act — or GENIUS Act — recently failed a motion for consideration on May 8 due to political pushback linked to former President Donald Trump’s crypto ties. However, Lummis, a co-sponsor of the bill, confirmed her commitment to pursuing responsible digital asset regulation and suggested the Senate may revisit the vote soon.

These developments reflect a broader legislative push to modernize U.S. financial regulation to keep pace with innovation in digital assets, while balancing transparency, competitiveness, and tax fairness.