New Tax Bill Alleviates IRS Reporting Burden

Cryptocurrency taxation has been the main focus of the IRS for some time. However, the new bill was proposed last week, which is supposed to alleviate IRS reporting for some cryptocurrency transitions. 

The existing legal framework requires that all gains, no matter how small, get reported to the IRS as taxable income. However, this bill can change it.

The Virtual Currency Tax Fairness Act

The Virtual Currency Tax Fairness Act brings a necessary change in the current crypto taxation system. This bill will make all transactions with gains less than $200 exempt from tax. It will remove the burden of reporting micropayment transactions to the IRS during the taxation season.

Coin Center, a cryptocurrency advocacy group, played a key role in crafting the Virtual Currency Tax Fairness Act. Jerry Brito, the chief executive, believes that current reporting measures are too harsh and create disadvantages for cryptocurrency investors. Now, the new bill will treat cryptocurrency as foreign currency.

Representative Susan DelBene, who submitted the proposal together with David Schweikert, notes that the Virtual Currency Tax Fairness Act opens the door for further innovations and grows the digital economy in the US.

Additionally, representative Tom Emmer introduced a bill to help the taxpayers who want to comply with tax regulations become exempt from penalties. The new bill will arrive just in time for taxation season, as many struggle with filling out Form 1040.