A bipartisan bill, "The CryptoCurrency Tax Fairness Act," was introduced in the House of Representatives on Thursday It calls for a tax exemption for transactions under $600, Fortune reports.
The bill was introduced by Rep. Jared Polis (D-Co) and Rep. David Schweikert (R-Az).
Under the proposed legislation, users of the digital currency will be able to make purchases under $600 without paying taxes. If the bill is passed by the House and Senate and signed by US president, the tax exemption would become effective on December 31.
“Individuals all over the world are starting to use cryptocurrencies for small every day transactions, yet here in the States we have fallen behind and make cryptocurrency use more of a challenge than it needs to be,” Schweikert said in a statement.
“To keep up with modern technology, we need to remove outdated restrictions on cryptocurrencies, like Bitcoin (Bitcoin), and other methods of digital payment. By cutting red tape and eliminating onerous reporting requirements, it will allow cryptocurrencies to further benefit consumers and help create good jobs,” Polis explained.
The new law also urges the US Treasury Department to prepare guidelines for declaring profits and losses in cryptocurrency, as the process is now too complicated. The bill will create tax rules similar to those applied for foreign currencies and will relieve bitcoin holders from the necessity to track all their transactions.