Indiana and New Hampshire, two States in the U.S. have proposed a bill that will allow cryptocurrencies to be used for tax payments. The documents which were filed on January 24 and January 4 respectively, call for the adoption of virtual currencies in the area of taxation.
Indiana and New Hampshire May Join Ohio in Accepting Bitcoin
Indiana and New Hampshire may likely join Ohio to accept Bitcoin for tax payments. This is because a bill has been filed in either State and it requires the approval of the government for these digital assets to be used. In the case of Indiana, the current tax code will have to be amended in order to meet the proposed change.
Indiana’s House bill number 1683 was filed on January 24 and it states that one or more digital assets have to be selected to pay taxes. The asset will also be used for penalties, costs, special assessments, interests, among others. The document also says an exchange rate should be determined for the selected virtual asset(s).
New Hampshire’s Proposal for the Use of Virtual Assets for Taxes
New Hampshire’s House bill number 470-FN, on the other hand, was filed on January 4 and it seeks to allow “state agencies to accept cryptocurrencies for payments”. According to the document, the State Treasurer and other authorities involved, need to set up a framework that will allow virtual currencies to be used for tax and fee payments from July 1, 2020.
The bill also notes that the current policy in place is to return payments made in currencies other than the U.S. dollars to the payor. In addition, if the use of cryptocurrencies is approved, then their volatility could pose a problem. The document, therefore, proposes that tax payments received in Bitcoin should be converted to fiat in order to mitigate risk.
Potential for More U.S. States to Adopt Cryptocurrencies for Taxes
BTCNN on November 25 reported that Ohio, Texas is the first state in the U.S. to accept Bitcoin for taxes. The portal used to facilitate these transactions is ohiocrypto.com and Bitpay’s service has been employed. In January, Overstock announced that they will be the first company in Ohio to pay their taxes using the platform.
The approval of Bitcoin for tax payments in Ohio may have encouraged several other states to innovate. Reports also reveal that prior to the digital asset’s acceptance in the region, states like Georgia, Arizona, and Illinois and had made proposals. Unlike Ohio, the use of virtual assets never came to be.