• The crypto tax laws in the U.S are exceedingly complicated
• 2022 is going to be a particularly hard tax period for crypto fans given the high level of losses incurred
• People should avoid too much non-bitcoin trading due to the SEC crackdown
Crypto Tax Laws in the US
The crypto tax laws in the U.S. are exceedingly complicated, and while there have been people who have sought access to specific jobs in our government by saying they will make them easier to understand, it wasn’t enough to hit home with voters or those tasked with making such decisions.
Crypto Tax Situation for 2022
The IRS has been poised to go after crypto investors for some time, and one of the big problems is that those in power are giving them secret windows to do so. For example, in 2021 a new infrastructure bill was unveiled designed to target crypto investors even harder come 2024. 2022 is likely going to be a particularly hard tax period for crypto fans given the high levels of losses incurred; Bitcoin lost more than 70 percent during this time frame.
Terrence Yang – managing director of Swan Bitcoin – commented that people should collect documentation on sales and investments that went to zero as many did when the bubble burst last year. He also suggested that people sell immediately, rebuy, and lock in any capital loss benefits from realized taxes.
Most of the tax laws that apply to altcoins also suggest they are securities and therefore Yang advises people avoid too much non-bitcoin trading because of potential SEC crackdowns on those activities.
The U.S Crypto Tax situation is complex and everchanging but it’s important for people investing in cryptocurrencies or other digital assets remain up-to-date on all relevant regulations and documentation requirements so as not run afoul of IRS regulations or face penalties from enforcement agencies like the SEC .