Cryptocurrency Needs Fair Taxation: Lawmakers Introduce Supportive Legislation

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You might not know it, but every time you spend cryptocurrency in the US, you are creating a taxable event. Despite digital currencies being convenient payment methods, the nation’s regulators do not treat purely digital representations of value as either legal tender or a foreign currency.

The US regulatory body, the Commodity Futures Trading Commission (CFTC), considers Bitcoin and other digital currencies as commodities. The nation’s tax authority, the Internal Revenue Service (IRS), considers cryptocurrencies as assets or intangible property. Yet, people can spend digital currencies just like they would dollars or foreign currencies. This is a problem because when an individual exchanges digital currency for either goods or another currency (spends it or trades it), the IRS considers that a taxable event.

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