Intuit CEO Says Bitcoin and NFT Investors Could Face Large Tax Bill

By Kevin • February 2, 2022 6:04 pm • Comments

The crypto bull run last year back in 2021 brought a lot of new investors into the crypto markets as the general public become more aware of what crypto was.

As more and more people get involved, one of the things that is always inevitable for those based in the US is the taxes that are involved with dealing in crypto and NFTs.

Intuit’s CEO stated that a lot of these tax bills are going to come as a surprise for newer investors in the space as many aren’t usually aware of what the regulatory implications are.

Trending: Federal Reserve Chairman Jerome Powell Say Federal Reserve Cannot Own Bitcoin

This may be especially true as regulatory agencies are seemingly getting more involved in the space now to enforce new rules to regulate the emerging technology industry.

Fortune reports:

Intuit Inc. Chief Executive Officer Sasan Goodarzi warned that Americans who invested in speculative assets like Bitcoin or nonfungible tokens, and actively traded equities on commission-free websites could be dumbfounded at this year’s tax bill.

Regulators have signaled they are preparing to act aggressively to ensure those who purchased NFTs are taxed appropriately.

However, there remains some confusion over how the sale or purchase of tokens will be evaluated by the Internal Revenue Service.

For example, NFTs, which give buyers the rights to digital images, could face a tax rate as high as 37%.

But a murky tax code may also benefit Bitcoin investors, as it could allow them to claim deductions over losses that were then reinvested within a certain time frame.

Meanwhile, some individuals who traded on platforms like Robinhood Markets Inc. over the past year—many that were likely first-time investors—remain confused over whether they actually need to file and could face large tax bills.

The tax software company is already gearing up for tax season as it expects a lot of confusion regarding the upcoming taxes.

The company has already updated its software and is hiring a team within the company to specifically help users file their crypto taxes indicating how much the demand for this type of service has increased within the past few years.

Now that major tax software and filing companies are covering the crypto space, many investors see this as a positive thing as it indicates that rules and regulations are finally catching up to the technology which will therefore encourage mainstream adoption.

Yahoo reports:

Intuit is prepared for that confusion among taxpayers.

The Mountain View, California-based financial software provider has been hiring experts to help tax filers online, a service known as “TurboTax Live,” which Goodarzi said “is the fastest growing platform we’ve ever had in the company’s history.”

“What we are seeing is folks not understanding the implications of the income that they make,” he said. “We have over 50 million TurboTax customers.

Anonymously, we can look at data patterns, provide insights. So that’s where the real sort of leverage comes in for us.”

With rules and regulations finally in place and mainstream acceptance starting to be achieved in some countries, it is only a matter of time until the majority of other countries start to do the same.

Based on this current trend, some investors remain optimistic and willing to embrace tax regulation in the crypto industry.

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