• The crypto tax laws in the U.S. are exceedingly complicated, and the IRS is poised to go after crypto investors for some time
• 2022 is likely to be a particularly hard tax period given the large losses caused by the cryptocurrency bubble burst
• Terrence Yang advises people to collect documentation on sales and investments, as well as avoiding too much non-bitcoin trading due to SEC regulations
Overview of Crypto Tax Situation
The crypto tax laws in the U.S. are exceedingly complicated, with agencies like the Securities and Exchange Commission (SEC) and Internal Revenue Service (IRS) looking deeper into crypto activity. 2022 is likely to be a particularly hard year for those investing in cryptocurrencies due to large losses from the bubble burst.
Infrastructure Bill Aimed at Crypto Investors
In summer 2021, an infrastructure bill was unveiled designed to target crypto investors even harder come 2024. Although it sounded like it would be beneficial for America’s hospitals, schools, roads, etc., it was actually written so politicians could get more money out of investors‘ pockets.
Impact on Bitcoin Investors
Bitcoin had been trading around $68,000 per unit before 2021 began but ended up at only $16,600 by 2022 – a loss of more than 70 percent throughout the year. Many investors saw this as unrealized losses in their bitcoin exposure which could have led to major capital loss taxes if they didn’t take action soon enough.
Advice from Terrence Yang
Terrence Yang – managing director of Swan Bitcoin – recommends collecting documentation on sales and investments that went to zero during 2021’s bubble burst in order to benefit from potential tax benefits when reselling them later on. He also suggests avoiding too much non-bitcoin trading due to SEC regulations regarding altcoins being classified as securities rather than currencies or commodities.
Conclusion
Crypto taxes can be difficult for anyone trying to figure out how everything works with regards to their own finances and investments – especially given current regulations by government agencies such as the SEC and IRS which are targeting those who invest in cryptocurrency even harder now than ever before thanks to new bills like infrastructure legislation designed for additional taxation income from investors themselves . This makes it all the more important for people understand what’s going on and act quickly if they need access any potential benefits that may arise from making certain decisions involving their assets or investments .
