A new bill proposed in the US House of Representatives will seek to eliminate crypto transactions below $200 from capital gains taxes. These are potentially 95% of the total number of transactions undertaken by the crypto trading community so it is a big deal for the cryptopreneurs around the country and many are calling for the bill to be passed by the lower house.
Capital gains taxes are introduced by governments around the world on the trading community. They are ever-present in the commodities trading, stock trading and even futures trading. Capital gains taxes are levied on trading activity for many reasons including revenue generation and keeping a check on the trading activity from extensive speculation. They have been around for decades and cryptocurrencies are now being started to be taxes under the capital gains taxes regime.
In the USA, capital gains taxes are levied on all major trading sectors and need to be filed to the government through the IRS. Unreported transactions are considered as tax fraud and is a very serious offence in the country. While there is no definitive legislation on cryptocurrency trading taxes in the country, a maximum of 20% capital gains taxation is being charged by the IRS under an adhoc arrangement. While many cryptocurrency traders donot file these crypto taxes, it is expected that the IRS will go against this practice in the near future. It has already notified over 10,000 individuals who are suspected of dealing in cryptocurrencies and yet are not filing them properly. So, filing cryptocurrency-related gains is going to be a serious matter in the near future if you are not already filing it.
But, this could change in the future as a new house bill is being debated by congress right now. The new bill titled ‘‘Virtual Currency Tax Fairness Act of 2020’’ was presented in the house by Congresswoman Suzan Delbene. The proposed bill will be discussed in detail by the 116th congress and will be eventually adopted or rejected in the near future. If the bill is passed, more than 95% of crypto gains taxation will be ended, effectively clearing the way for a better de-regulated industry. The move is also likely to encourage increasing tokenization of the shares and other digital trading currently going on around the country in an effort to cut back on the capital gains taxes. This would boost the overall blockchain coin industry and help more and more projects get into decentralization.
Americans who are interested in cryptocurrencies and trading can support the bill by calling their respective congressmen’s office and recording their support for the said bill. The bill will also make America a competitive market for crypto trading as elsewhere in the world, crypto taxation is being increased rather than being implemented in low volume cases. In Europe itself, crypto gains taxes are already more than America’s unamended figure of 20%.
The bill was filed by Congresswoman Delbone on January 15, 2020. A reddit thread is also going on around this subject for some time. Users can participate in this thread and make their voices heard as well.
image source: pixabay.com
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