Spending Crypto – Post #4
Continuation from Spending Crypto – Post #3
Since my last post I did some additional digging. My simple conclusion from Post #3 was ” I think the crypto regulations are not quite there to have the masses even entertain the practicality of using crypto in established economies.”
H.R. 5635: Virtual Currency Tax Fairness Act of 2020
The H.R. 5635 bill was introduced January 16, 2020 and simply put would not have any tax implications if you were to spend your crypto on same personal items where the gains of the individual sale were less that $200. This is promising, Grandma may be ok with this.
Gross income of an individual shall not include gain, by reason of changes in exchange rates, from the disposition of virtual currency in a personal transaction (as such term is defined in section 988(e)). The preceding sentence shall not apply if the gain which would otherwise be recognized on the transaction exceeds $200.
In addition, if passed, the H.R. 5635: Virtual Currency Tax Fairness Act of 2020 would be effective December 31, 2019. This would be very beneficial for those that want to use their crypto in everyday transactions and negates my conclusions from Spending Crypto – Post #3
Game on
I think moving forward with caution on this experiment is worth the effort, but just to be safe I will scale it down to less than $100 per month. We could always just extrapolate the findings at the end as if I were to spend as I usually do on a per month basis.
About the CryptoBack terms
I read the “fine print” if you will on the CryptoBack Debit Card. It noted that the Crypto you spend would be the Crypto you receive back. Fair enough, however the 3% crypto coming back would be deposited after 90 days of the original transaction.
Wow, that could be a risk. For example, lets say I spend 1 ETH on a transaction and it is $250, would that be 0.03 ETH back? Or would it be the equivalent of the $ dollar amount?
So $250 = 1 ETH at time of transaction, the $ dollar amount is $7.50.
If after
90 days, say ETH was $500:
Would it be 0.03 ETH = $15?
Would it be 0.015 ETH = $7.50?
If after 90 days ETH was $125:
Would it be 0.03 ETH = $3.75?
Would it be .06 ETH = $7.50?
Many question bouncing around in my head, but I wil keep posting updates over the next 6 months of the experiment.
All Spending Crypto series:
Spending Crypto – Post #1
Spending Crypto – Post #2
Spending Crypto – Post #3
Spending Crypto – Post #4
Credits:
Photo by Dmitry Demidko on Unsplash