• The Biden administration is looking to impose new rules on crypto taxation, including a wash sale rule and doubling capital gains taxes.
• The proposed budget plan for the 2024 fiscal year aims to reduce the deficit by almost $3 trillion over the next ten years and raise around $24 billion by implementing changes to the current crypto tax regime.
• The administration is considering expanding the existing wash sale rule to include digital assets as well, in order to prevent tax-loss harvesting. Capital gains taxes could be doubled from 20% to 36.9%.
Biden Administration Looking To Impose New Rules On Crypto Taxation
The Biden administration is looking to impose new rules on crypto taxation, which will include the wash sale rule and doubling capital gains taxes.
New Budget Proposal Doubling Down On Crypto
The President of the United States, Joe Biden, has been looking into changing up the crypto taxation rules. According to the latest reports, the administration’s upcoming budget proposal might double down on capital gains taxes for certain investors. There is even word of imposing a wash sales rule on crypto. The budget plan for the 2024 fiscal year is scheduled to be released on March 9th. According to reports, it will focus on reducing the deficit by almost $3 trillion over the next ten years and raising around $24 billion by implementing changes to the current crypto tax regime. However, since there is a Republican House majority currently in power, this proposal may be blocked despite Democratic leadership and Senate control.
Preventing Tax-Loss Harvesting In Crypto
The proposed wash sales rule is being considered in order to prevent tax-loss harvesting – a strategy where a trader would sell their assets at a lower price for a deductable loss and then repurchase those assets soon after. This strategy cannot be applied when trading regular stocks or bonds due to an existing wash sale rule that prevents it; however digital assets have not yet been officially classified as securities so cryptocurrency trading and taxation aren’t covered under this rule just yet. The Biden administration is therefore considering expanding this rule so that it includes digital assets too – preventing any form of tax-loss harvesting from occuring with cryptocurrencies either way.
Increasing Crypto Capital Gains Tax
Another significant change that could be implemented with this budget proposal is increasing capital gains taxes for certain investors who deal with cryptocurrencies – potentially doubling them from 20% up to 36/9%. Additionally there are talks of also increasing income levies on corporations and wealthy Americans too – making sure everyone pays their fair share of taxes overall no matter what they’re investing in or how much money they make throughout any given financial year period or otherwise like it should always be anyway!
Crypto will still face trouble from other sources even if these proposals don’t get passed through though – such as how earlier this month (February) IRS expanded its scope when it comes specifically related towards cryptocurrency taxation; requiring anyone who has ever dealt with digital assets before having report about them now also regardless if whether or not they were previously doing anything illegal intentionally or unintentionally either way unfortunately still nonetheless sadly enough… Furthermore there’s speculation that NFTs could also become taxable eventually too further down line later sometime afterwards accordingly afterwards accordingly too as well likewise likewise additionally…