Congressman Steve Stockman (R-TX), announced this morning at Inside Bitcoins NYC that he plans to introduce the first piece of U.S. legislation on virtual currencies this afternoon. The Virtual Currency Tax Reform Act would authorize the Internal Revenue Service to treat virtual currencies as currency for federal tax purposes. The bill finds that:
“The Classification of virtual currencies as property means that users would be required to pay capital gains tax on any transaction using the virtual currency based on any gain over the virtual currency’s value from the time of purchase.”
The IRS issued guidance for virtual currencies on March 25, 2014 that stated virtual currencies, including Bitcoin, are to be treated as property for federal tax purposes. This requires capital gains on virtual currencies to be recorded and reported. The Bitcoin Foundation says this could lead to unrealistic reporting.
Rep. Steve Stockman said that he is introducing this bill “to build awareness and create a consensus in the Bitcoin community around government regulation of virtual currencies… I don’t think anyone really has a flavor of what they want and I want to start the Bitcoin conversations.”
Rep. Stockman is the first member of U.S. Congress to accept Bitcoin contributions.
Article credit: Forbes
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