Sec. 201. Gain from disposition of digital assets

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Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after section 139I the following new section: Gross income shall not include gain or loss from the sale or exchange of virtual currency in a personal transaction (as defined in section 988(e)(3)) for goods and services. The amount of gain or loss excluded from gross income under subsection

(a)with respect to a sale or exchange shall not exceed $200. For purposes of this subsection, all sales or exchanges which are part of the same transaction (or a series of related transactions) shall be treated as one sale or exchange. Subsection

(a)shall not apply to sales or exchanges in which virtual currency is sold or exchanged for cash, cash equivalents, digital assets (as defined in section 9801 of title 31, United States Code), or other securities or commodities. For purposes of this section, the term virtual currency has the meaning given such term in section 9801 of title 31, United States Code. In the case of any taxable year beginning in a calendar year after 2023, the dollar amount in subsection

(b)shall be increased by an amount equal to— such dollar amount, multiplied by the cost-of-living adjustment determined under section 1(f)(3) for the calendar year in which the taxable year begins, determined by substituting calendar year 2022 for calendar year 2016 in subparagraph (A)(ii) thereof. Any increase determined under the preceding sentence shall be rounded to the nearest multiple of $50. . The table of sections for part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 is amended by inserting after the item relating to section 139I the following new item: Sec. 139J. Gain or loss from sale or exchange of virtual currency. . The Secretary shall issue regulations providing for information returns on virtual currency transactions for which gain or loss is recognized. The amendments made by this section shall apply to transactions entered into after December 31, 2022.