Senate introduced a new bipartisan bill to simplify use of crypto for everyday purchases. This would allow tax exempt for transactions less than $50 and capital gains under $50.
New ‘Virtual Currency Tax Fairness Act’
A new bipartisan bill, known as the “Virtual Currency Tax Fairness Act,” was introduced in Congress Tuesday by Senators Pat Toomey (R-PA) and Kyrsten Sinema (D-AZ).
According to the announcement by the U.S. Senate Committee on Banking, Housing, and Urban Affairs, the bill aims to “simplify the use of digital assets for everyday purchases” by creating “tax exemption for small personal transactions.”
Senator Toomey commented, “While digital currencies have the potential to become an ordinary part of Americans’ everyday lives, our current tax code stands in the way.” He added:
Americans will be able to easily use cryptocurrency as a payment method by using the Virtual Currency Tax Fairness Act. This Act exempts from tax small transactions such as buying coffee.
According to current law, any crypto used to purchase goods of any value is a taxable event. If the cryptocurrency appreciated by even one penny, the individual would be liable to the Internal Revenue Service for capital gains.
The new legislation seeks to “amend the Internal Revenue Code of 1986 to exclude from gross income de minimis gains from certain sales or exchanges of virtual currency, and for other purposes,” the text of the bill reads.
Continue the announcement:
Virtual Currency Tax Fairness Act (VTCFA) would make it easier to use digital assets in everyday transactions. The act creates a de minimis exemption that allows gains less than $50 and personal transactions less than 50 dollars.
Toomey and Sinema’s Virtual Currency Tax Fairness Act also has bipartisan support in the House of Representatives. In February, Reps. Suzan DeBene (D.WA) and David Schweikert(R.AZ) presented a prior version of this legislation. This bill was designed to allow personal transactions with cryptocurrency that are less than $200 exempted from the tax.
Do you have any thoughts about the Virtual Currency Tax Fairness Act (VTCFA)? Are you a believer that small transactions in crypto should not be subject to tax? Please leave your thoughts in the comment section.
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