US Congress Proposes New Crypto Bill For Easier Transactions

The US Congress has just introduced a new bill that will make it extremely easier for consumers to spend their Bitcoin. Some of the representatives proposed the bills on Thursday, January 16 and it is believed that the bill could even ease up the approach on taxes so let’s find out more in the latest cryptocurrency news below.

Known as the Virtual Currency Fairness Act of 2020, the bill will eliminate all needs for consumers to calculate taxes on the crypto transactions that will result in capital gains under $200. This could even change the tax act that is more than 35 years old. This is not the first attempt to pass a law of this kind since, in 2017, the US Congress introduced an earlier version of the bill which proposed a $600 exemption limit. This bill has a lower limit which could be more appealing to legislators but there’s no real guarantee that it could be put into law.

The bill tackles one very important issue: Bitcoin is continuously shifting its market price and when businesses start accepting it they will convert it to US dollars. This means that when the individuals spend their Bitcoin, they will have to calculate how much value their holdings gained once they got their hands on Bitcoin. They will also have to keep records of the gains and report on the amounts on the taxes. The crypto supporters suggested that this will not work. Despite this complex tax structure, it does not seem that the capital gains are much of an issue in practice since the payment processors such as BitPay and Coinbase Commerce have almost no trouble attracting users who want to spend their crypto.

This bill could be a sign that the US government wants to ease the approach to crypto so it is clear that the capital gains are generally taxed. The IRS released new tax guidelines which only confirmed that the investors in the US will have to pay taxes on gains from the sale and conversion of virtual currency so it clarifies that gains on airdropped cryptocurrencies are also a subject to taxes. The IRS worked with Chainalysis to investigate tax evasion and they were able to identify the coinholders on the public blockchains and exchanges.