The US Bipartisan Bill to Eliminate Taxes For Small Bitcoin Transactions
- The US Bipartisan Bill will exempt tax on gains of $200 or less.
- It aims at revising the Internal Revenue Code of 1986.
The U.S. House Of Representatives lawmakers published a bipartisan bill on Thursday. It states a tax exemption for everyday crypto transactions which has gains worth 200$ or less. But as of now, all gains earned from crypto trading are considered taxable income regardless of the amount or the motive of the transaction. This bill was introduced by Reps. Suzane DelBene, D Wash, and David Schweikert, R-Ariz and sponsored by Representatives Darren Soto and Tom Emmer.
The co-author of the bill, Rep. Suzan DelBene, said to Bitcoin Magazine, “Antiquated regulations around virtual currency do not take into account its potential for use in our daily lives, instead of treating it more like a stock or ETF”. He further added, “However, virtual currency has evolved rapidly in the past few years with more opportunities to use it in our everyday lives. This commonsense bill cuts the red tape and opens the door to further innovations, ultimately growing our digital economy.”
When Bitcoin is used as a payment method, it involves a sale for the Internal Revenue Service (IRS) because the payer discards its BTC property partly in return for a good or service. This creates an event that if the funds have been gained at a lesser U.S. dollar value, the difference will be considered capital gains. Therefore, it would require reporting and taxing.
The motive of this bill is to revise the Internal Revenue Code of 1986 to eliminate the above requirements when the gain is $200 or less. This is primarily aimed at smaller transactions to provide them with a boost or encourage the use of Bitcoin for payments in the U.S.
Schweikert says that this bill is a significant step forward and lays the foundation for the growth of the digital economy. He also says, “Virtual currency is reshaping our everyday lives, and the United States needs to recognise this and work to treat these currencies fairly in our tax code.”