EddieJayonCrypto
1 Oct 25
The IRS and Treasury eased tax burdens for crypto-holding corporations by clarifying CAMT rules, excluding unrealized gains from digital assets like Bitcoin, reducing compliance costs, and eliminating potential liabilities for firms such as Strategy Inc.
**IRS and Treasury Ease Tax Burdens for Crypto-Holding Corporations** The U.S. Treasury Department and the Internal Revenue Service (IRS) have issued interim guidance that significantly alleviates tax pressures on corporations holding Bitcoin and other digital assets, offering clarity on how the Corporate Alternative Minimum Tax (CAMT) applies to unrealized gains. The notices, 2025-46 and 2025-49, released on September 30, address a critical uncertainty that had unsettled corporate treasuries following the 2024 proposed regulations (REG-112129-23). The guidance aims to reduce compliance costs and clarify how firms calculate their adjusted financial statement income (AFSI), the tax base for CAMT. Under the 2022 Inflation Reduction Act, CAMT imposes a 15% minimum tax on corporations with average annual AFSI exceeding $1 billion. Previously, unrealized gains from digital assets like Bitcoin were included in AFSI without adjustments, potentially creating massive “paper tax liabilities” for companies with significant crypto holdings. This update is particularly impactful for firms like Strategy Inc. (formerly MicroStrategy), which holds over 640,000 BTC. Under new accounting standards adopted in January 2025, the company reports Bitcoin at fair value, with unrealized gains and losses affecting quarterly net income. Before the guidance, analysts anticipated that Strategy would face CAMT obligations in 2026, exposing it to billions in potential liability. The new rules allow the exclusion of unrealized crypto gains from AFSI, eliminating this risk. “This shift removes a major overhang on our long-term strategy of holding Bitcoin as a reserve asset,” said Strategy Inc. spokesperson. With over 100 public companies holding more than 1 million BTC, the ruling could solidify Bitcoin’s role as a corporate reserve instrument. Bitcoin advocates have welcomed the move as a validation of corporate adoption. Investor Peter Duan noted that the IRS clarification provides firms with the certainty needed to continue accumulating BTC without fear of taxation on unrealized gains. Jeff Walton of Strive Asset Management echoed this, calling the decision a removal of a “massive FUD narrative” that had deterred companies from reporting strong digital asset performance. The interim guidance allows companies to immediately rely on the relief, with similar provisions expected in future regulations. This development marks a pivotal moment for the intersection of cryptocurrency and corporate tax policy, signaling growing recognition of digital assets in the financial landscape.