Digital Asset PARITY Act

(20) Infrequently traded digital assets

(A) In general. In the case of a contribution of a digital asset which is not an actively traded digital asset the claimed value of which exceeds $500—

(i) paragraph (8) shall not apply and no deduction shall be allowed under subsection (a) for such contribution unless the taxpayer substantiates the contribution by a contemporaneous written acknowledgment of the contribution by the donee organization that meets the requirements of subparagraph (B) and includes the acknowledgment with the taxpayer's return of tax which includes the deduction, and

(ii) if the organization sells such asset, the amount of the deduction allowed under subsection (a) shall not exceed the gross proceeds received from such sale.

(B) Content of acknowledgment. An acknowledgment meets the requirements of this subparagraph if it includes the following information:

(i) The name and taxpayer identification number of the donor.

(ii) Details of the transfer of the digital asset contribution, including—

(I) specific addresses involved in the contribution,

(II) a description of the digital asset contributed, and

(III) the date of the contribution.

(iii) A certification that the digital asset was sold in an arm’s length transaction between unrelated parties.

(iv) The amount of gross proceeds from the sale described in clause (iii).

(v) A statement that the deductible amount may not exceed the amount the gross proceeds described in clause (iv).

(vi) Whether the donee organization provided any goods or services in consideration, in whole or in part, for the digital asset.

(vii) A description and good faith estimate of the value of any goods or services referred to in clause (vi), or if such goods or services consist solely of intangible religious benefits (as defined in 170(f)(8)(B)), a statement to that effect.

(C) Contemporaneous acknowledgement; Information to Secretary. Rules similar to the rules of subparagraphs (C)(i) and (D) of paragraph (12) shall apply.

6720D. Fraudulent acknowledgments with respect to donations of digital assets

(a) In general. Any donee organization required under section 170(f)(20)(A) to furnish a contemporaneous written acknowledgment to a donor which knowingly furnishes a false or fraudulent acknowledgment, or which knowingly fails to furnish such acknowledgment in the manner, at the time, and showing the information required under section 170(f)(20), or regulations prescribed thereunder, shall for each such act, or for each such failure, be subject to a penalty equal to the greater of—

(1) the product of the highest rate of tax specified in section 1 and the sales price stated on the acknowledgment, or

(2) the gross proceeds from the sale of such digital asset.

(b) Regulatory authority. The Secretary shall prescribe such regulations or other guidance as may be necessary to carry out the purposes of this section.