Senators Propose Bill to Cut Taxes on $50 Crypto Payments

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  • Senators Patrick Tomei and Kirsten Senema introduced a new bill to the US Senate to exclude small crypto transactions from capital gains tax requirements.
  • The law will apply to transactions under $50, with a requirement to adjust this standard along with inflation.
  • Similar bills, setting the benchmark at $200, have been submitted to Congress in the past.

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Similar initiatives have been made previously in two other bills still in Congress, but there is little indication that they will be voted into law any time soon.

Senators introduce bill on tax-free crypto transactions

A new bill aimed at lowering taxes on small crypto payments has entered the US Senate.

According to an announcement on Tuesday, Senators Patrick Tomei (R-Penn) and Kirsten Sinema (D-Arizona) introduced a bill aimed at making crypto transactions of up to $50 capital gains tax-exempt to the US Senate. As is currently the case, the Internal Revenue Service treats crypto assets as property and crypto transactions as investments rather than payments, meaning that Americans are obligated to track and pay capital gains taxes every time they exchange or sell cryptocurrency. This has significantly hampered the potential use of the asset class in mainstream commerce, which in turn has been used by many critics and regulators as an argument against the usefulness of cryptocurrency as money.

Dubbed the Virtual Currency Tax Justice Act, the bill seeks to exclude small crypto transactions from capital gains tax requirements. If the law is voted on, the law will apply to transactions under $50, with a requirement to amend this standard along with inflation. Notably, similar provisions have been submitted to Congress in the past, including homonymous bipartisan parties law Project In February by Representatives Susan Delbiny, David Schweikert, Darren Soto and Tom Emmer that set the minimum at $200. In June, Senators Kirsten Gillibrand and Cynthia Loomis introduced A Comprehensive crypto bill This, among many other things, also sought to reduce taxes on all crypto transactions under $200.

While crypto lobby groups and the broader community have widely applauded efforts to exempt small crypto transactions from capital gains tax requirements, the chances of any bills passing into law by the end of the year are relatively low. The current legislative calendar – which is full of issues not related to cryptocurrency – is closing before the midterm elections in November. In addition, Senator Tommy will not be running for re-election, which means he will not be around to push the bill into its potential enactment in the next Congress.

Disclosure: At the time of writing, the author of this article owns ETH and several other cryptocurrencies.

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