Will the US opt for a crypto-friendly tax policy? That’s what a bill introduced yesterday proposes. The bill calls on politicians to decide whether to enact a tax exemption on gains from crypto-currency transactions. Of course, it is not a general exemption and requires a strict condition to be met. Indeed, the exemption would only apply to crypto transactions worth less than 50 dollars ($). This is a very small amount. But if it is adopted, it will already be a first small positive step for all American consumers. However, this should be tempered by the fact that a similar bill is already under consideration in the US House of Representatives.
The bill is sponsored by two senators. They are Pat Toomey and Kyrsten Sinema. Called the Virtual Currency Tax Fairness Act (VCTFA), they introduced it to Congress earlier this week. In fact, the VCTFA is not new. The purpose of the legislation is to strengthen the legitimacy of cryptocurrencies in the digital economy. It also aims to expand the use of cryptocurrencies for payments in the country. In other words, this text is intended to encourage and favour cryptos, while providing a clear and precise framework for them.
Recall that it contains to date a provision similar to that presented by the senators. Except that this one involves a higher threshold. Specifically, the first bill in this sense provided to exclude from gross income (for income tax, “IR”) the gains from the sale of cryptocurrencies, and this in the limit of $200 dollars.
Crypto taxation: A reporting exemption for small amounts in the US?
At the same time, the de minimis exemption would exempt investors from reporting their small transactions. This is less burdensome and burdensome for consumers. Currently, US law requires them to report gains made on the value of crypto they spend. It would be applicable to crypto transactions – cryptos only. Because the text comes to expressly exclude fiat – crypto transactions. In addition, “all sales or exchanges that are part of the same transaction (or series of related transactions) are treated as a single sale or exchange.” Another advantage is that the $50 threshold could be adjusted in times of inflation.
One of the senators sponsoring the bill states:
“While digital currencies have the potential to become an ordinary part of Americans’ daily lives, our current tax code stands in the way.”
Politicians are expected to decide by the end of August. Further legislation on cryptocurrencies is also expected.
