Renowned lawyer Jeremy Hogan has issued guidance to XRP holders aimed at helping them maximize their cryptocurrency tax liability.
In a recent statement, pro-XRP attorney Jeremy Hogan provided valuable insight for crypto enthusiasts planning to take advantage of the 2024 crypto bull market. Hogan emphasized that strategic tax planning plays a key role as investors seek to optimize returns.
“As you plan how to profit and become crypto rich in 2024, don’t forget to have a tax strategy in place.” lawyer said.
Notably, his address was specific to the U.S. crypto community. The lawyer urged crypto investors to focus on the holding period of their tokens and consider the tax implications of their investment strategies.
Do not sell XRP that you have held for more than 1 year
Hogan noted that holding tokens for more than a year could result in a more favorable tax scenario. He said tokens held for more than a year are subject to long-term capital gains, which are taxed at a lower rate of 15%.
In contrast, short-term gains on tokens held for less than a year are subject to a higher rate of 30%.
Additionally, Hogan highlighted the common practice of some investors selling their XRP to move into other tokens and reinvesting in XRP after making a profit.
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This strategic move comes amidst a prolonged period of poor price performance for XRP. For example, XRP hasn’t made holders much of a profit in the past two months, while other rivals like Solana and Cardano are making investors millionaires.
Pro-XRP lawyers pointed out that it could be profitable to temporarily sell off XRP for other assets. But he highlighted the potential downside.
Specifically Hogan pointed Such traders will lose their long-term tax status on XRP. As a result, they will be exposed to his two short-term tax rates.
I’ve seen a few people say they’ll sell their XRP and buy another token, and once they make money on the other token, they’ll buy XRP again.
Of course, you’re giving up long-term tax status on your XRP and giving yourself two short-term tax rates. Just be careful…
— Jeremy Hogan (@attorneyjeremy1) January 2, 2024
“I’dRatherPayLess,” Hogan concluded his tweet, suggesting investors should prioritize preserving long-term tax benefits rather than succumbing to underwhelming short-term performance.
In other words, experienced lawyers advise XRP investors to be aware that their trading decisions may result in unintended tax consequences.
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Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the personal opinions of the author and do not reflect the opinions of The Crypto Basic. We encourage our readers to conduct thorough research before making any investment decisions. Crypto Basic is not responsible for any financial losses.
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