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Home Blog Page 4210

How to manage Crypto Taxation

By
Paul Ugbede Godwin
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0

Crypto and taxation are two topics that many people find confusing and complex. However, it is important to understand how crypto assets are taxed and what you need to do to comply with the IRS rules. Crypto assets are treated as property, not currency, for tax purposes. This means that you have to report any capital gains or losses when you sell or use your crypto in a transaction.

Crypto and taxation are two topics that are becoming increasingly relevant and important for investors, businesses and individuals. Crypto assets, such as Bitcoin, Ethereum and Dogecoin, are decentralized digital currencies that operate on blockchain technology. They are not issued or controlled by any central authority, and they can be used for various purposes, such as payments, investments, transfers and donations.

However, crypto assets are not exempted from taxes. The IRS treats crypto assets as property for tax purposes, which means that any transaction involving crypto assets may trigger capital gains or losses, depending on the market value of the crypto asset at the time of the transaction. For example, if you buy Bitcoin for $10,000 and sell it for $15,000, you have a capital gain of $5,000 that is subject to tax. Likewise, if you buy Bitcoin for $10,000 and use it to buy a car worth $8,000, you have a capital loss of $2,000 that can offset your other taxable income.

Investors in the Great Lake State are explained by their tax practitioners near Michigan how the new tax laws are going to affect them. Capital gains are taxed at different rates depending on how long you hold the assets before selling or exchanging them.

There are different types of crypto transactions that may have tax implications, such as:

  • Buying or selling crypto assets on an exchange or a peer-to-peer platform.
  • Trading one crypto asset for another.
  • Receiving crypto assets as payment for goods or services.
  • Mining or staking crypto assets.
  • Donating or gifting crypto assets.
  • Forks or airdrops of crypto assets.

Each type of transaction has its own rules and requirements for reporting and paying taxes. For instance, if you receive crypto assets as payment for goods or services, you must report the fair market value of the crypto asset in U.S. dollars as income on your tax return.

If you mine or stake crypto assets, you must report the fair market value of the crypto asset in U.S. dollars as income on the date you receive it. If you donate or gift crypto assets to a qualified charity or a person, you may be eligible for a deduction or an exclusion from your taxable income, depending on the amount and the recipient.

The IRS has issued some guidance on how to report and pay taxes on crypto transactions, but there are still many unresolved issues and questions. For example, how to determine the cost basis and holding period of crypto assets, how to account for fees and commissions associated with crypto transactions, how to treat hard forks and airdrops of crypto assets, and how to deal with foreign tax issues related to crypto transactions.

Therefore, it is advisable to consult a tax professional who is familiar with crypto taxation before engaging in any crypto transaction. You should also keep accurate and detailed records of all your crypto transactions, including the date, amount, type and value of each transaction.

You may need to use third-party tools or services to help you track and calculate your crypto gains or losses. You should also be aware of the tax deadlines and forms that apply to your situation. Failing to comply with the tax rules and regulations may result in penalties and interest from the IRS. However, Metamask and some crypto exchanges like; Binance, Coi offers premium tax filing policies.

Nigerian Govt in Talks with NIPOST to Commence Mail Delivery of Passports to Nigerians

By
Samuel Nwite
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The Nigerian government said it is in talks with the Nigerian Postal Service (NIPOST) to commence mail delivery of passports to Nigerians, as part of efforts to effect swift service.

The move was disclosed by the Minister of Interior, Rauf Aregbesola, who spoke at the opening of the Nigeria Immigration Service Passport Front Desk Office in Auchi, Edo State, on Saturday, 20th May 2023.

“We are in the final stage of concluding negotiations with NIPOST to begin using its speed mail service to deliver passports to Nigerians wherever they are in the world after production,” the Minister disclosed.

Passport delivery in Nigeria is among the poorest globally, and has pitted applicants against the Nigerian Immigration Service (NIS) for years.

A statement by Sola Fasure, Media Adviser to the Minister, the launch of an additional Passport Front Office in Auchi, Edo State, was part of the government’s effort towards effective service delivery to Nigerians.

He quoted Aregbesola as saying that it was the intention of the government to provide the passport to anyone desirous of it within a reasonable time, at an affordable price and without any stress.

However, Aregbesola, while stating that Edo State has one of the highest passport applications in Nigeria, revealed that the waiting period between application and collection would likely increase due to the recent increase in demand.

“Our current working schedule is that fresh application would take six weeks after biometric data registration and three weeks for renewal. This is reasonable, competitive and in line the global best practices,” he said.

“The challenge, however, is the waiting period at the point of application and data registration.

“All applicants will be put in a queue, depending on the centre of their choice, to determine the registration date. Regrettably, it might take two months in some highly competitive centers where the application is very high. We have no control over this.”

He further said that the federal government was intentional about opening more front desk offices, in order to increase the registration centers and reduce the waiting period before biometric data capture.

In the past few years, Nigerians had had to spend several months on the waitlist of the Nigerian Immigration Service for their passport delivery. In 2021, Aregbesola announced new rules geared toward making passport processing and issuance seamless and faster as backlash grew over the lackluster nature of the NIS. The rules included creating special centers, which will run on a public-private partnership basis, for expedited services.

“Our goal is to have one in each local government area, university campuses, institutions of higher learning and other relevant public places,” he said then.

Edo State is said to rank fifth amongst states with the highest volume of passport applications locally.

“In the past 365 days, Edo State has processed 56,291 applications out of the 1.5 million passports produced in Nigeria. The commissioning of this front office will no doubt go a long way in reducing the traffic in Edo State and other neighboring States,” the Comptroller General of the Nigerian Immigration Service, Isah Jere Idris, said.

This year alone, the Minister of Interior had been in Daura in Katsina State, Alimosho in Lagos, Ilesa in Osun, Zaria in Kaduna and Oyo in Oyo State to commission Passport Front Desk Offices.

The government’s move to incorporate mail delivery into the recent changes made to fasten passport service is expected to boost other measures, which are believed to have increased the pace of passport issuance nationwide.

How US Debt Ceiling Paralysis Could Affect Your Investments

By
Ndubuisi Ekekwe
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0

Good People, some of our learners in the Tekedia Investment and Portfolio Management program have asked me how the paralysis on the US debt ceiling could affect some of their investments. Our subject matter experts will examine this in our June edition, but as a former banker, I will offer some perspectives here. If the United States does not resolve this quickly, here are things you should expect.

  1. For currency traders, the US dollar will fall. 
  2. US stocks will fall with negatives for most indices.
  3. Bond yields will spike. The implication is that bond prices will go down.
  4. Many will lose their jobs as growth will stall.
  5. More so, if this should happen, it could cause severe economic pains across the globe since the US dollar is the leading currency for global trade.

That said, I do not believe that the US will not break this ceiling; it has always been doing that for generations. That the US will default is academic because it will not happen. They will play politics and then get serious just hours to any default. 

That said, if you are investing in the US,  we posit that you create a US entity and use that entity to invest if you are unable to work directly under a US entity. We have looked at recent recoveries/settlements and observed that settlements are first extended to US persons and entities before international persons and entities. 

In other words, US persons and entities are being prioritized during recoveries and settlements:  “Meanwhile, the new FTX CEO John Ray, who replaced Bankman-Fried to guide FTX’s restructuring, is trying to rescue funds that were lost by the crypto company’s depositors when the firm spiraled into bankruptcy in November last year….John Ray III, while testifying to the U.S house committee, disclosed that U.S. customers are more likely than other customers to get their money back.”

Implications of Ripple’s Battle with U.S. Securities and Exchange Commission (SEC)

By
Paul Ugbede Godwin
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The legal battle between Ripple Labs and the U.S. Securities and Exchange Commission (SEC) over the status of XRP, the world’s seventh-largest cryptocurrency, has reached a critical stage. Both parties have filed their final briefs in support of their summary judgment motions, asking the court to rule in their favor without a trial. This case has been hanging in court for over two and half years with no clear direction on reaching a logical resolution.

The SEC claims that Ripple sold XRP, its native cryptocurrency, as an unregistered security, violating federal laws and harming investors. Ripple denies these allegations and argues that XRP is not a security, but a digital asset that facilitates cross-border payments on its decentralized network.

The case hinges on whether XRP meets the criteria of the Howey test, a legal framework that determines whether an asset is a security or not. According to the Howey test, an asset is a security if it involves an investment of money in a common enterprise with an expectation of profits from the efforts of others. Ripple contends that XRP does not satisfy these conditions, as it has utility and value independent of Ripple’s actions, and that XRP holders do not have any contractual or ownership rights in Ripple.

The SEC, on the other hand, asserts that Ripple created and distributed XRP as part of a scheme to raise funds for its business operations and to enrich its founders and executives. The SEC also accuses Ripple of making false and misleading statements about XRP to influence its price and market perception. The SEC seeks to stop Ripple from selling XRP and to impose civil penalties and disgorgement of ill-gotten gains.

One of the key points of contention in the case is the speech given by former SEC director William Hinman in 2018, in which he stated that neither Bitcoin nor Ethereum were securities. Ripple wants to use this speech as evidence that the SEC did not provide clear guidance on the status of XRP and other cryptocurrencies. The SEC, on the other hand, wants to keep the speech and related documents sealed, claiming that they are internal deliberations and not official statements.

However, a federal judge recently ruled that the documents related to Hinman’s speech should be made public, giving Ripple a significant win in its legal battle. The judge said that sealing the documents would not serve the public interest or protect the SEC’s candor. The documents could reveal how the SEC formed its opinion on crypto assets and whether it applied consistent standards to different tokens.

The court’s decision has also boosted XRP’s price, which rose by 8% after the news broke. Many crypto enthusiasts see the case as a potential precedent for how U.S. regulators will treat cryptocurrencies in the future. Ripple’s CEO Brad Garlinghouse said he was happy with the transparency and hoped that the unredacted Hinman emails would be available soon.

The outcome of the case could affect not only Ripple and XRP, but also other cryptocurrencies and blockchain projects that may face similar regulatory challenges in the future. The case could also set a precedent for how the SEC approaches crypto regulation and enforcement in general.

Jigbo Launches To Take Up Indomie Noodles

By
Ndubuisi Ekekwe
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Abacha (the dried shredded cassava delicacy which is very popular in Southeast Nigeria) is going global [I do not have the correct Igbo alphabet on my laptop to differentiate the pronunciation from a human “Abacha”]. Some smart guys have pre-processed abacha with spices to go. So, you do not need the raw cassava and all the efforts needed to shred it.
 
It seems Jigbo has NAFDAC seal already and is exporting to US, UK, etc from Ogbete, Enugu. Indomie noodles, you have a decent competitor right now, because the brand Jigbo is here.
 
When we say low level semi-manufacturing, this is what it is. As they scale, they can reduce cost while improving quality. Magically, this becomes another category in the FMCGs. Yes, Flour Mills of the world will quickly adopt and add. If we cannot make a rocket, we can at least shred cassava, package and reduce food wastages.

Comment on Feed

Comment 1: This one enter, I will be interested in the spices and the number of ingredients baked in there. Indomie and co now have a rival, abacha has been christened, and it’s now going global.

We need another miracle on bread, all the key ingredients must be sourced locally, we eat a lot of bread in this country, and buying one small loaf for N1000 was not part of the original agreement.

Substitution method is what we need in the food space now, foods must be abundant and affordable. To eat food is a right, and not a privilege.

Comment 2: Excellent to see. Have had this many times and reminds of childhood! Can be had hot or cold! That said, appalled by the translation of what he is saying – so much off the point!

My Response: “That said, appalled by the translation of what he is saying – so much off the point!” – you need to be in Ogbete, Kano market, Ariaria, Ogbomosho, etc to understand why he emphasized on those. Making a point that it was not from China, while unnecessary, is addressing more than 80% of the questions. Nigeria does not make anything and many buyers will need answers on those.

That said, the days when Nigerian makers can find ways to engage professional sales people, we will advance. In other words, getting someone to polish the product  communication to appeal to more customer bases.

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