The tax bill for a former NFL player exposes the difficulties with BTC salaries

According to a recent report, NFL star Odell Beckham’s (OBJ) decision to accept his $750,000 salary in Bitcoin (BTC) has resulted in a significant loss owing to the market collapse after he signed the contract. OBJ is believed by some to have made 61% less than if he had taken his wage in fiat owing to

The tax consequences of receiving a salary or yield in cryptocurrency have been made more apparent following the theft, as crypto investors must pay tax on the value it was worth when they received it, rather than the value it is now.

On Nov. 12, 2018, OBJ signed a one-year contract with the Los Angeles Rams worth $750,000. In a CashApp sponsored Twitter post, OBJ announced that he would be paid in whole Bitcoin instead of conventional currency.

The day after the Super Bowl, OBJ signed a five-year contract worth $98 million with the Los Angeles Rams. At the time, Bitcoin was breaking all-time highs around $69,044 and just two days earlier, he had inked his deal with the Rams. OBJ’s investment has lost 46% of its value since then.

According to sports business analyst and senior executive producer for The Action Network Darren Rovell, OBJ’s decision to accept his entire wage in Bitcoin was a poor decision. nnCompared to the original $750,000, Rovell claims that OBJ’s complete compensation is now only worth $413,000.

At a rate of 50.3 percent, Odell will have earned $35,000 in the previous two and a half months, or 1 BTC. This is compared to what he would have made if he’d kept his fiat-based salary.

Joe Pompilano, the brother of social media celebrity Anthony, claimed that there were many significant differences between Rovell’s account and reality, such as that he was paid weekly rather than annually.

However, Rovell claimed that the weekly payments were unimportant to the tax treatment: “The whole payment has been made. It makes no difference when he is paid.”

Tax troubles

This isn’t the first time that cryptocurrencies have caused big tax disparities, and as crypto use spreads across the world, it won’t be the last. There were numerous reports from customers who were charged large taxes after acquiring their assets at a higher price than they fell to by tax time due to “crypto winter.”

It’s worth noting, however, that most organizations will require crypto asset values to be revealed the moment they are acquired. This exposes investors to a huge tax penalty if the value of their cryptocurrency falls between purchase and the filing of their return.

In 2019, Australian crypto investor Micky the story of an Australian crypto investor who was compelled to pay nearly five times the value of his coins in tax, according to Adrian Forza, director of Crypto Tax Australia.

“It was a disaster… It was a really unfair outcome because he’s basically received cryptocurrency and the value has dropped significantly and now he has to pay tax on money he doesn’t have.”

“The main problem with cryptocurrency taxation isn’t necessarily that the rules themselves are bad, but rather that many crypto users don’t understand tax laws,” Forza added. “It’s mostly a demographic of 25-to-40-year-olds who haven’t invested in shares or seen an accountant before.

This may be the case with blockchain-based play-to-earn games like Axie Infinity. In one famous incident, a 22-year-old in the Philippines bought two houses with the money he earned from playing the game. He may have spoken to a tax advisor because now both Philippine and international authorities are coming for those earnings, warning

Crypto Tax Calculator Australia is a tax calculator application designed to help calculate their taxes they need to pay on their cryptocurrency transactions in Australia. With three plans available to choose from (Free trial, Basic and Advanced), calculating your taxes have never been easier.