Bill For Small Crypto Transactions And Taxes Returns To US Congress

A new bill for small crypto transactions and taxes returns to US Congress. The bill seeks to exempt personal cryptocurrency transactions from taxation for capital gains has been reintroduced in the Congress of the United States.

The crypto news today show that the bill for small crypto transactions is called “The Virtual Currency Tax Fairness Act of 2020” and aims to establish an exemption for virtual currency expenditures that qualify as personal transactions. Users would then not have to report the instances when they spent crypto whose value had changed relative to the US dollar on day-to-day expenses.

The representatives including Suzan DelBene (D-WA) and David Schweikert (R-AZ) introduced the bill today – even though the bill was introduced in a version earlier in 2017 which featured a substantially lager exemption.

Now, existing law struggles to cope with cryptocurrencies as they sometimes act as investments, sometimes are commodities and sometimes – just like other currencies. This is why the new bill for small crypto transactions looks to simplify the action for crypto traders and users.

Currently, the IRS could hold crypto users responsible for paying taxes on the gains earned and realized unknowingly, based solely on the value of their crypto at a time of purchase. This system would make use of crypto as currency incredibly cumbersome within the US.

The newly reintroduced bill would also exempt taxpayers from a reporting duty – only if their gains are under $200. This would only apply with major purchases or wild bull markets. The earlier version of this bill put the number at $600.

In addition to this, the bill would insert a new category within existing IRS exclusions from classification as gross income. Meanwhile, taxing cryptocurrencies has proved a major sticking point in the US. In December last year, eight members of the Congress sent a letter to the IRS asking the tax agency to clarify rules for reporting income due to the hard forks or air drops.

Last year, representatives sent a similar letter to the IRS and were dissatisfied with the current clarity. Still, what is important now is the fact that the market is in a good momentum and the climate is good for new changes coming ahead.