Toxic, Uncensored Take on Crypto Tax Laws: Senator Lummis Pushing for Reform
Senate Representative Lummis Highlights Inconsistent Tax Regulations Allegedly Discriminating Against Bitcoin
Listen up, crypto enthusiasts! It's time to gripe about the dame- near U.S. tax laws that are grinding your digital dreams to a halt. U.S. Senator Cynthia Lummis won't stand for it and is calling for urgent action to change the crypto tax game.
Here's the tea: Bitcoin miners are getting skewered by the current rules, according to Lummis. They're being taxed twice - once on block rewards and again when they sell their coins. And, don't even get us started on DeFi users. They're juggling multiple taxable events without even snagging profits.
And who can forget IRS regulations, birthed from that 2021 Infrastructure Investment and Jobs Act beast? These regulations define crypto miners and developers as "brokers," forcing them to spill beans they don't really have, like the names of users, and details of their transactions.
Lummis is hollering for Congress to get their act together and fix this mess. She's got it in her head to use the reconciliation process, which allows tax law changes to pass with a simple majority, to slim down the definition of "broker" and ease the burdens on the crypto industry.
With Bitcoin just reaching an all-time high of $111,600, and legislators discussing significant crypto bills like the GENIUS and CLARITY Acts, plus a new bill proposing a Strategic Bitcoin Reserve, the crypto tax reform train might finally be leaving the station.
Keep your eyes on that prize, crypto fans. The pressure is building, and with market momentum on our side, crypto tax reform might just be the reality we're facing soon!
Optional Insight:
In the United States, Bitcoin and other digital assets are treated as property for tax purposes, similar to real estate or stocks. Ranging from 10% to 37%, gains from the sale or exchange of these assets are subject to capital gains tax after one year of holding, while short-term gains are taxed at ordinary income tax rates[1]. In 2025, U.S. cryptocurrency exchanges will be required to report transactions using a new tax form, Form 1099-DA[5].
[1]: IRS.gov, 2022. [2]: IRS.gov, 2022. [3]: Nasdaq.com, 2022. [4]: Berkeley, L., n.d. [5]: Bloch, R. S., 2021. [6]: Blockchain.com, 2022.
- In the push for crypto tax reform, Senator Lummis advocates for redefining the term "broker" to alleviate the tax burdens on the Bitcoin and DeFi business sectors, especially addressing the double taxation issue faced by Bitcoin miners.
- As technology continues to revolutionize finance, the ongoing debate over crypto tax regulations becomes increasingly significant, particularly with the introduction of bills like the GENIUS and CLARITY Acts, aiming to address the intricacies of taxation surrounding digital assets such as Bitcoin and DeFi platforms.
- The heavy taxation on digital assets, like Bitcoin and DeFi transactions, could potentially hinder the growth and development of associated businesses in the burgeoning technology landscape if urgent action for reform is not pursued, as advocated by Senator Lummis.
