In brief
- Block founder Jack Dorsey tweeted a call for a de minimis tax exemption on everyday Bitcoin transactions, prompting Sen. Cynthia Lummis to reply she’s “Working on it.”
- Lummis urged supporters of the tax exemption to contact their representatives.
- The exemption was part of crypto tax reforms that failed to make it into Trump’s reconciliation bill in July when pro-crypto senators ran out of time before the vote.
Block founder Jack Dorsey has called for a federal tax exemption on everyday Bitcoin transactions, urging for the revival of a legislative effort that fell short just months ago when pro-crypto senators ran out of time to attach critical tax reforms to President Trump’s massive reconciliation bill.
“We need a de minimis tax exemption for everyday bitcoin transactions,” Dorsey tweeted, as his payments company announced it is debuting a new Bitcoin payments and crypto-integrated wallet targeting small businesses using its Square point-of-sales system.
“Working on it. If this is of interest to you, please tell your Senators/House member!” Senator Cynthia Lummis (R-WY) responded to his tweet.
The exchange points to unfinished business from July, when Lummis attempted to attach crypto-friendly amendments to Trump’s “One Big, Beautiful Bill” but failed to get them to the Senate floor before Vice President J.D. Vance cast the tie-breaking vote passing the legislation.
The proposed amendments would have included a de minimis exemption allowing Americans to avoid reporting crypto transactions under a few hundred dollars for capital gains purposes, exactly what Dorsey is now demanding.
Bitcoin and tax
Currently, the IRS treats crypto as property, meaning even small purchases trigger taxable events that create significant reporting burdens for merchants and consumers alike.
In the hectic final hours of negotiations over the reconciliation bill in July, pro-crypto senators and industry policy leaders raced to include the de minimis exemption and other benefits for crypto stakers, miners, and businesses holding digital assets.
Lummis had vowed to reintroduce the proposal in upcoming Senate sessions, calling it a key step toward Bitcoin adoption.
Arthur Azizov, Founder and Investor at B2 Ventures, told Decrypt that a de minimis exemption “is a pragmatic fix for a paperwork problem,” adding that it could help merchants and wallets experiment with Bitcoin.
But Azizov cautioned the exemption alone won’t turn Bitcoin into a reliable payment method, noting that stores can still lose money if Bitcoin’s price changes between payment and conversion to dollars.
He added the reform needs to be “part of a package that includes clear broker-reporting rules, anti-fragmentation protection, and fiat-conversion tools” to become “a realistic step toward broader merchant adoption.”
Lummis and crypto
Lummis has remained active on crypto tax reform on multiple fronts.
In May, she and Senator Bernie Moreno (R-OH) sent a joint letter to Treasury Secretary Scott Bessent demanding immediate action on a separate but related Biden-era tax policy that puts U.S. crypto firms at risk of paying millions in taxes on profits they haven’t realized.
“Neither Congress nor FASB planned this outcome,” the senators wrote. “It’s the unintended result of basing tax liability on decisions by a private organization… not principles of taxation.”
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