Bitcoin HODLers live by the words of the 1987 Rick Astley hit song, “Never Gonna Give You Up.” Many have held their stack for years, through steep price declines, only to see the price ratchet up to new highs every year. In contrast to short-term trading, it’s a buy-and-hold investment strategy that seems to be working.
Janet Yellen doesn’t care.
Treasury Secretary Janet Yellen announced on October 23 that a proposed tax on unrealized capital gains — yes, gains from investments that haven’t even been sold yet — could help finance President Biden’s now scaled-back $1.75 trillion social spending bill. Senate Finance Committee Chairman Ron Wyden has come up with the idea that would be a landmark change to the way U.S. citizens are taxed.
If Yellen and the U.S. Congress have their way, wealthy investors may be taxed on those unrealized gains, the price appreciation of their assets. The tax would apply to all “property,'' which includes stocks, real estate, gold and even cryptocurrencies like bitcoin. Cryptocurrency is not looked at by the IRS as currency, but rather as property. Every time you sell or spend cryptocurrency, you have a taxable transaction resulting in either a capital gain or capital loss.
The effort would be an attempt to squeeze more taxes from America’s wealthiest families, by assessing a tax on assets that have appreciated but not yet been sold. Wyden’s plan would
apply to those with over $1 billion in assets or those who experience three straight years of income over $100 million. Income is easily verified from tax returns, but assets, well, that becomes a bit more complicated. Some assets are priced publicly, but many aren’t.
Some members of Congress are apparently not thrilled that some
