New house bill is a trap! It changes the status of #crypto from property to currency that is subject to ordinary gains instead of capital gains! This is NOT to #crypto holders advantage.

New house bill is a trap! It changes the status of crypto from property to currency that is subject to ordinary gains instead of capital gains! This is NOT to crypto holders advantage.

It’s a god damn trap. They want to catagorize virtual currency under section 26 of US code.

https://coincenter.org/files/2020-01/delben-049-xml-final.pdf

(b) VIRTUAL CURRENCY.β€”For purposes of this section, the term β€˜virtual currency’ means a digital representation of value that is used as a medium of exchange and is not otherwise currency under section 988.

Under section 988 (a)(1)(A)

“Except as otherwise provided in this section, any foreign currency gain or loss attributable to a section 988 transaction shall be computed separately and treated as ordinary income or loss (as the case may be).”

Do you want to pay capital gains that starts at 0% and tops out at 28% or do you want to pay ordinary income which starts at about 10% and goes upward of 35%?

These bills are almost NEVER to your advantage. It also means that the IRS can claim that any coins you recieved by just owning crypto (coin splits) are income events.

submitted by /u/cm18
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