Renowned pro-XRP attorney Jeremy Hogan recently addressed Cryptocurrency holders, providing crucial insights aimed at helping them maximize their crypto tax obligations.
In a post on X, Hogan strongly emphasized the significance of strategic tax planning for investors looking to capitalize on the anticipated 2024 crypto bull market. Indications such as the sudden bank shift pointed out by Forbes might trigger an XRP Price Bull Run in 2024.
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Strategic Tax Planning for Crypto Enthusiasts
“In 2024, as you plan how to take profit and become CryptoRich, don’t forget to strategize for taxes,” Hogan emphasized, positioning tax planning as a pivotal aspect of the broader investment strategy.
Hogan’s guidance is particularly tailored to the U.S. crypto community, urging investors to carefully consider the tax implications of their investment decisions, with a specific focus on the duration of their token holdings.
Dear U.S. Guys/Gals,
In 2024, as you plan how to take profit and become CryptoRich!, don't forget to strategize for TAXES.
Holding a token for over one year vs. less than a year can mean the difference between paying 15% or 30% to taxes. See attached.
Truly,
I'dRatherPayLess pic.twitter.com/wHALaUnHgE
— Jeremy Hogan (@attorneyjeremy1) January 2, 2024
The Advantage of Long-Term Holding
One key piece of advice Hogan offered is the potential tax benefits of holding a token for over a year. He pointed out that tokens held for a long duration (more than a year) generate long-term capital gains and are subject to a lower tax rate of 15%, in contrast to the higher 30% rate applied to short-term gains on tokens held for less than a year.
Caution Against Short-Term Trading Strategies
Hogan raised awareness about a common practice among some investors who sell XRP to explore other tokens, only to reinvest in XRP after generating profits.
While acknowledging the potential profitability of such a strategy, Hogan also highlighted a significant downside, he said “I have seen some people say they’re selling XRP, buying another token, and will buy XRP again after making some money in the other token. Fair enough, but now you have given up your long-term tax status on XRP and given yourself two short-term tax rates. Just be aware…”
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— TimesTabloid (@TimesTabloid1) July 15, 2023
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He noted that traders adopting this approach risk forfeiting their long-term tax status on XRP, exposing themselves to the higher short-term tax rates. This caution comes at a time when XRP has faced challenges in terms of price performance compared to some of its counterparts like Solana which has seen substantial gains.
Hogan concluded by appealing to investors to put their long-term tax benefits ahead of giving in to disappointing short-term results. The Attorney’s message serves as a reminder for XRP investors to remain vigilant about the unintended tax consequences of their trading decisions.
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