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U.S. lawmakers are pushing for a bill to create a tax exemption for low-value cryptocurrency transactions, CoinDesk reported.
“The Virtual Currency Tax Fairness Act of 2020” was introduced on Thursday by Reps. Suzan DelBene (D-Wash.), David Schweikert (R-Ariz.), Darren Soto (D-Fla.) and Tom Emmer (R-Minn.). It seeks to amend the IRS tax code to exempt realized gains less than $200.
“Gross income of an individual shall not include gain, by reason of changes in exchange rates, from the disposition of virtual currency in a personal transaction […] The preceding sentence shall not apply if the gain which would otherwise be recognized on the transaction exceeds $200,” the bill reads.
Back in 2017, Rep. Jared Polis and Rep. David Schweikert, co-chairs of the Blockchain Caucus, sought to create a similar de minimis exemption for cryptocurrency transactions (under $600) with the Cryptocurrency Tax Fairness Act. The bill, however, could not make it to the committee.
“We have been advocating for a solution like this for years and are proud to have worked with Representatives Delbene and Schweikert to get the idea reintroduced,” Coin Center said in an online post.
Neeraj Agrawal, director of communications for Coin Center, said that exempting low-value day to day transactions from capital gains would help “level the playing field for this technology.”
"Extending this sensible exemption to cryptocurrency would allow users to do simple things like send small transactions to each other or fractions of pennies to dapps without having to deal with a fairly complicated capital gains calculation every time,” he said.
The bill would apply with respect to transactions entered into after December 31, 2019.
