A bipartisan group of US lawmakers reintroduced the PARITY Act on May 21, 2026, asking the Internal Revenue Service to formally study whether crypto transactions under $200 should be exempt from tax reporting requirements. The bill was announced via CoinMarketCap on X and revives a proposal that has cycled through several congressional sessions without ever reaching a floor vote.
The mechanism is narrow but consequential. Under current US tax law, every disposition of cryptocurrency is a taxable event, including paying for a $4 coffee with bitcoin or settling a $20 dinner tab with a stablecoin balance. Each swipe creates a capital gains or loss calculation that the taxpayer is obligated to track and report.
The de minimis problem this bill targets
Foreign currency transactions already enjoy a $200 de minimis exemption under section 988(e) of the tax code. That carve-out exists because Congress recognized decades ago that tracking gain or loss on every euro spent abroad would crush ordinary travelers in paperwork. Crypto never got the same treatment.
The result is a structural friction for anyone trying to use crypto as money rather than as an investment. Even a routine $30 grocery run paid with a self-custody card technically generates a reportable disposition. Tax software vendors have built entire businesses around reconciling these micro-events, and most users either ignore the obligation or simply refuse to spend their crypto.
The PARITY Act does not, by itself, create the exemption. It directs Treasury and the IRS to conduct a formal study on whether and how a $200 threshold could work, including how to prevent structuring (splitting a $1,000 purchase into five $200 transactions) and how to handle the accounting burden for wallet providers.
The stakes for crypto card users
For the crypto card market specifically, this is the single biggest tax friction in the US. Every card in our database, whether it draws from a custodial exchange balance or a self-custody wallet, creates a taxable disposition at the moment of authorization. That includes self-custody options like Gnosis Pay and stablecoin-funded cards that some users assume are exempt because the value is dollar-pegged.
Stablecoin-funded transactions are arguably the cleanest case for an exemption. If a user spends one USDC for one dollar of merchandise, there is functionally zero gain or loss, but the disposition still has to be reported. A de minimis rule would let providers stop generating 1099-DA forms for trivial-value spending and let users actually use their balances without a tax accountant on speed dial.
The proposal is also one of the few pieces of crypto-relevant tax policy that has historically attracted Republican and Democratic co-sponsors, partly because it does not touch the more politically charged questions of token classification, staking treatment, or DeFi reporting.
The political path forward
Reintroduction is not passage. The PARITY Act and its variants have been floated since 2017 in different forms, including bills from Representatives Schweikert, Soto, Lummis, and Gillespie at various points. The current Republican-led Congress has shown more appetite for crypto legislation than its predecessors, including the CLARITY Act effort to combine Senate committees, but tax bills move slowly even with bipartisan support.
The study directive structure is itself a tell. Lawmakers who want immediate action write the exemption into law directly. A study request is the procedural equivalent of asking the agency to do the homework, which usually means the bill's sponsors do not yet have the votes for a clean exemption and want to build a record before pushing harder.
Treasury, for its part, has historically opposed de minimis rules for crypto, arguing they create enforcement gaps. The recent personnel shifts at the IRS and the ongoing rulemaking on broker reporting under section 6045 mean any study would land in an unsettled regulatory environment.
Practical implications for spenders right now
Nothing about user obligations changes today. US taxpayers spending crypto in 2026 still owe capital gains calculations on every disposition above zero, and the IRS form 1099-DA reporting regime begins phasing in for brokers this year regardless of what happens with the PARITY Act.
For users genuinely worried about tax friction, the practical workarounds remain unchanged: spend stablecoins (still reportable but typically near-zero gain), use cards funded from accounts already held in fiat, or simply track everything through a tool like CoinTracker or Koinly. None of these eliminate the reporting burden, they just make it manageable.
A passed PARITY Act would not retroactively forgive any obligations either. It would create forward-looking relief for transactions occurring after the effective date.
Overview
The reintroduced PARITY Act would direct the IRS to study a $200 de minimis exemption for crypto transactions, modeled on the existing foreign currency carve-out. It addresses one of the most persistent friction points for everyday crypto spending in the US, where every card swipe currently creates a taxable disposition. The bill has bipartisan sponsors but starts with a study directive rather than a direct exemption, suggesting a multi-year legislative path even in the best case. For now, crypto card users in the US should keep tracking their dispositions and assume the current rules apply through at least the 2026 tax year.
