Strategy Inc. Stock Rises After Tax Rule Update
Strategy Inc. (MSTR), led by Michael Saylor, saw its stock price rise 5.93% on Wednesday. The Bitcoin-focused company announced it will no longer be subject to the U.S. corporate alternative minimum tax.
This followed new guidance from the U.S. Treasury Department and Internal Revenue Service. The update changes how digital assets are treated under the tax rule.
Previously, Strategy was expected to pay a 15% corporate minimum tax starting in 2026. This tax applies to companies with average annual profits over $1 billion for three years. Strategy’s earnings and Bitcoin holdings made it a likely target for the tax.
New Tax Guidance on Digital Assets
The Treasury and IRS released interim guidance on Tuesday. It states that unrealized gains and losses from digital assets can be excluded when determining if a company crosses the $1 billion threshold.
Unrealized gains are profits on paper from assets not yet sold. Strategy said it now expects to be exempt from the corporate minimum tax. This tax was introduced under the Inflation Reduction Act to ensure profitable firms pay a minimum federal tax.
Following the announcement, Strategy’s shares rose to $341 from a daily low of $320.
Strategy’s Bitcoin Holdings and Accounting
Strategy is a major corporate adopter of Bitcoin. It follows accounting rules that require reporting Bitcoin holdings at fair market value, even if the coins are not sold.
For the six months ending June 30, Strategy reported an $8.1 billion unrealized gain on Bitcoin. The company holds about $74.6 billion in Bitcoin, making it the largest public company holder worldwide.
