Tracking the Token Taxonomy Act

[Sharkey 817]

Most of us have seen references to the proposed Token Taxonomy Act, first introduced in the previous session of Congress (115th Congress) last December, with no action by the end of that session.  There seems to be a range of thought about when (or if) this law will ever be approved, and the extent to which it will impact regulation in the US.  Of the possible outcomes (if it is ever voted into law), the first (and most relevant to all of us) could finally answer the question of whether digital assets are exempt from the definition of security.  But there is also an interesting possibility that the law could amend the tax code to lessen the burden on US citizens who actively trade digit assets.  

"Each of the amendments would be effective retroactively for sales or exchanges on or after January 1, 2017. This retroactive effective date could provide relief for traders and other sellers of qualifying crypto assets who have failed to report certain of their transactions to the Internal Revenue Service and possibly provide those traders and sellers who have reported their transactions with an opportunity to claim a refund for certain taxes paid."  (from National Law Review article cited below)

It looks like the proponents of this bill will be re-introducing it with some tweaks at some point "soon" in the new Congress.

 It is interesting that the sponsors of this bill are a republican and a democrat, Congressmen, Warren Davidson (R-OH) and Darren Soto (D-FL), both of whom recognize the need for the US to catch up with other nations in developing a forward-thinking approach to accounting for new technology within federal regulation.  

Although there isn't much new information on the progress of this legislation at the moment, I found the following article to be a nice summary of some possible ramifications.  

https://www.natlawreview.com/article/taxonomy-proposed-token-taxonomy-act

 

 

Edited March 3, 2019 by Sharkey
added citation

[xrphilosophy 1,914]

Thanks for the legit source.  This would be very helpful for taxes, and a long time coming:

"add an exemption to the “like-kind exchange” provisions of Section 1031 of the Code for virtual currency, which would allow a like-kind exchange of virtual currency to be treated as a non-taxable exchange, similar to the current treatment of real property under Section 1031; ."

[Sharkey 817]

20 minutes ago, xrphilosophy said:

Thanks for the legit source.  This would be very helpful for taxes, and a long time coming:

"add an exemption to the “like-kind exchange” provisions of Section 1031 of the Code for virtual currency, which would allow a like-kind exchange of virtual currency to be treated as a non-taxable exchange, similar to the current treatment of real property under Section 1031; ."

Agreed.  As a US citizen, I really don't appreciate being ****ed by the taxing authorities with so much ambiguity in the current tax laws, which I have elected to interpret conservatively, and to my own detriment, when I'm quite sure that many others have instead avoided to do.  It would be really great to have a (distant) hope of *someday* having clarity, no less getting a retroactive refund for what I've paid to date! 

[Hodor 21,713]

2 hours ago, Sharkey said:

Each of the amendments would be effective retroactively for sales or exchanges on or after January 1, 2017

Totally missed this part, @Sharkey! 

Let me get out my checkbook to make several checks out to several re-election campaigns...  

Edited March 3, 2019 by Hodor

[Sharkey 817]

46 minutes ago, Hodor said:

Totally missed this part, @Sharkey! 

Let me get out my checkbook to make several checks out to several re-election campaigns...  

HA!   That's ONE re-election cause that EVERYONE should embrace!  LOL.  

[invest2lose 1,826]

I hope this passes, i owe 50k for 2017 and another 35k in 2018 just because i was trading in dec 2017 and jan 2018. Fk taxes. 

[Archbob 755]

I actually got to deduct taxes because I didn't start until late December 2017 and it was mostly in BTC and LTC then.

[Sharkey 817]

 

[Sharkey 817]

https://twitter.com/hashtag/PassTokenTaxonomyAct?src=hash

 

[Simoun 5,237]

 

 

I'll say it once and I'll say it again, regulation doesn't get any sexier than light-touch regulation!

[TheXRPer 693]

If you're going to rant, can you at least use proper English and punctuation, especially when replying to someone with a law degree and properly scored high on his LSAT. 

[Sharkey 817]

16 minutes ago, TheXRPer said:

If you're going to rant, can you at least use proper English and punctuation, especially when replying to someone with a law degree and properly scored high on his LSAT. 

Point taken, but I don't think the ranter is likely to read this commentary in this forum, however.  

[GoodTimesRoll 3]

Crypto Regulation is a mystery to me. If Warren Davidson introduced this Bill in Dec 2018, what type of regulation was being worked on prior to that? Is Davidson a self appointed champion of this space or does he chair a specific committee charged with regulation? Seems to me without regs, ICE and others will be sitting on their hands.

I really don’t know exactly who or what group is responsible for the tax laws for crypto. 

Anyone, please weight in. 

 

[DreXRP 4,057]

https://bitcoinist.com/us-congress-introduces-two-new-cryptocurrency-bills/

US lawmakers are exploring new blockchain regulations. US Congress just introduced two new cryptocurrency bills aimed to address price manipulation and boost the country’s competitive edge in the new industry. 

[gamblin310 161]

Token Taxonomy Act was reintroduced today!

https://www.coindesk.com/lawmakers-reintroduce-bill-to-exempt-tokens-from-us-securities-laws?utm_source=twitter&utm_medium=coindesk&utm_term=&utm_content=&utm_campaign=Organic