According to The Wall Street Journal, the Biden administration is calling for tax changes to cryptocurrency transactions.
Now people can claim losses on the sale of underwater crypto investments and then buy them back.
The change is part of Biden’s 2024 budget proposal, which could raise $24 billion.
President Joe Biden is reportedly eyeing a tax loophole used by cryptocurrency investors as part of a proposed 2024 budget aimed at reducing the nation’s deficit by trillions of dollars.
The Wall Street Journal reports that Biden will propose changes to the taxation of cryptocurrency transactions. Current rules allow people to sell their underwater crypto investments, claim tax losses, and buy them back quickly.
The administration said such sales would not be subject to the so-called wash sale rule, which applies to stocks and bonds, the report said. The wash sale rule prevents people from selling shares and then quickly buying them back for tax purposes.
Biden’s 2024 budget is set to be released on Thursday, with the president aiming to cut the US deficit by about $3 trillion over the next decade.
Changing the tax regime for cryptocurrency trading could generate $24 billion in funding, according to the journal.
The proposal comes after crypto prices fell last year amid a sustained “crypto winter” in the market. Bitcoin has fallen more than 60% in 2022, and the broader crypto market’s valuation has fallen below $1 trillion after reaching $3 trillion in 2021.
The market is in recovery mode this year, with Bitcoin’s price up 30% year-to-date. The digital currency trading at around $21,760 on Thursday.
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