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Credit card companies crap on cryptocurrencies

(FINANCE NEWS) Credit card companies are now trying to make customers slow their roll when purchasing crypto – and it’s kind of shady.

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Visa and Mastercard and now making it more difficult for their customers to purchase cryptocurrency by slapping additional fees on transactions. This month, Bitcoin investors using Coinbase noticed additional fees on bank statements and were like, wait what?

Turns out, the credit card companies decided to reclassify cryptocurrency transaction type from “purchase” to “cash advance.”

Coinbase confirmed the change in an email to its customers, noting “the MCC code for digital currency purchases was changed by a number of the major credit card networks.”

A Mastercard spokesperson claimed the change “provides a consistent view of such purchases for both merchants and issuers.”

This means an additional five percent fee is slapped on to every transaction from the credit card company in addition to the four percent credit card processing fee Coinbase already passes on to its users.

Right now, if you want to buy Bitcoin or other cryptocurrencies instantly, your only option is using a credit or debit card. Transferring funds from your bank can take days, and since crypto prices can change in an instant, this isn’t a great option. Although there are lower fees for transferring funds via ACH, investors may get stung by fluctuating prices.

So basically, you’re going to use a credit or debit card for efficiency, but Visa and Mastercard want to make this harder on you. Unlike purchases, transactions labeled as “cash advances” don’t fall under an interest-free grace period. As soon as the purchase goes through, it accrues and compounds daily, so that’s pretty neat.

In addition to the new fee, cash advances carry higher interest rates as well.

Adding insult to injury, using a card for crypto purchases does not earn credit card points.

The card companies are equivocating bitcoin to withdrawing money from an ATM. This conflicts with the IRS’s stance that bitcoin is not currency, but rather taxable property.

Until everyone gets their stories straight, investors get stuck in the middle with more barriers to purchasing crypto, and conflicting regulation and processes.

And for Visa and Mastercard, that’s kind of the point. Their aim is to slow the rush of investment, even at the risk of losing potential millions in additional revenue. Assuming Bitcoin and other cryptocurrency don’t total crash and burn, eventually financial middlemen like credit card companies will be cut out of the picture.

Lindsay is an editor for The American Genius with a Communication Studies degree and English minor from Southwestern University. Lindsay is interested in social interactions across and through various media, particularly television, and will gladly hyper-analyze cartoons and comics with anyone, cats included.

Business Finance

Calculator for what your freelance rate should be

(FINANCE) When every second on the clock counts and saving is imperative, where can you go to figure out your optimal freelance rate?

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freelance rates

The issue of what your freelance rate should be is daunting for most, but is especially stressful for those who aren’t particularly mathematically gifted. When every second on the clock counts and saving is imperative, where can you go to figure out your optimal rate? A new calculator has an answer.

What Is My Day Rate is a salary calculator which determines the hourly (and daily) amount you’d have to charge in order to meet your optimal salary.

The calculator itself is intuitive enough: upon landing on the What Is My Day Rate webpage, you simply enter your preferred annual income and wait for the results to load. You’ll see both a daily and an hourly sum appear shortly thereafter.

The process of figuring out how much to charge is simple, but that doesn’t mean the process is simple.

What Is My Day Rate draws from similar geographical, workplace, and demographic data to give you a number which reflects post-holiday, post-fee, post-non-billable work results.

By clicking the “See how we calculated this” link at the bottom of the page, you can see a specific breakdown of how What Is My Day Rate determined your rate.

You’ll notice that they take into account weekends, holidays, sick leave, bonuses, benefits, and more.

If division is a strong suit for you, you may also notice that What Is My Day Rate operates on a 40-hour workweek model, meaning your rate might even be optimistic for your standards.

One problem with the calculator is that it doesn’t account for taxes of any kind; while it factors in a rather generous benefits percentage and adds in things like mandatory vacation time and unpaid sick leave, there’s still a noticeable gap between the calculator’s projected expenses and what you would probably have to pay.

On the plus side, tax brackets change, so you’ll be able to plug the day rate results into a separate tax calculator without worrying about accuracy issues.

What Is My Day Rate is a valuable tool for any freelancer looking to establish their daily freelance rate without necessitating a spreadsheet and several hours of botched accounting—or a more expensive alternative. If you’re worried about undercharging, head over to their site to lock in your rate ASAP.

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Business Finance

7 ways to quickly get outstanding invoices paid to you

(FINANCE) It’s easy to feel uncomfortable bringing up money with your superiors, but for a freelancer, it’s more important than ever to bring up the issue. Here are 7 tips to get your invoices paid quickly.

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For many, an awkward topic of conversation revolves around money. Whether asking for a raise or asking to borrow money, people often feeling uncomfortable when talking money.

This is equally, or possibly even more so, true for freelancers who are solely in charge of their finances. Without a system of weekly direct deposit, freelancers have to work overtime to keep their earnings in order.

The issue with this is that clients also have a lot on their plates, and something as simple as a freelancer’s paycheck is common to fall through the cracks. This causes freelancers to have to work friendly reminders into their repertoire.

However, freelancers may not always be knowledgeable of the best ways to keep their finances in check (no pun intended). Below are seven ways to enhance payment methods.

  1. You have to be willing to make billing a priority. Due to the fact that money is awkward to talk about, as aforementioned, many let this fall by the wayside. The best way to do this is to keep up to date with your invoices and send them as soon as they are done. Making a calendar specific for billing can help with this idea.
  2. This second bit dates back to when we were young and learning our manners: it is crucial to be polite. Not only is it the right thing to do, but it also increases speed in payment. Using “please” and “thank you” in invoicing emails are said to get you paid five percent faster.
  3. It is best to try and keep a complicated concept like finance as simple as possible. Make sure you are creating specific due dates. This will help to signify importance of payment.
  4. Now that virtually anything can be done online, it would make sense to use electronic payment verses an old-school check. Accepting online payments will get a user paid, on average, eight days faster as opposed to a check.
  5. This is an important notion to keep in mind for any aspect of your business life: be professional. Invoices are often seen by many eyes so it is best to include your business’s logo on said invoice. This has been found to increase chances of being paid on time by 10 percent.
  6. Specificity is urged again in the form of transparency. Make sure you are giving detailed descriptions on each invoice so that anyone looking at it knows exactly what you are being paid for. By doing this, you are 15 percent more likely to be paid on time.
  7. While you may be invoicing month by month, try to avoid sending on the 30th or 31st. Being that everyone, generally, sends their invoices in on these dates, it takes 10 – 20 percent longer to be paid. With everyone sending it at the end of the month, it has a tendency to back up payroll.

The most important thing to remember is that while the topic of money may be awkward, it is your money. If you let a few invoices fall behind because you are uncomfortable reminding your client, this has a way of adding up. Be sure to keep on track with your finances to earn what you are working for.

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Business Finance

How to invest in cryptocurrency without getting in trouble with the IRS

(FINANCE) Paying taxes on your cryptocurrency investments doesn’t have to be a headache with this simple tool.

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token tax for cryptocurrency capital gains

The next tax season will inevitably approach, and those of you who took a chance on cryptocurrency may be wondering: Do I have to pay tax on my digital investments? Sorry, but yes you do.

Although tax laws are constantly changing, especially in the wild west of cryptocurrency, fear not. Token Tax is the one tool to rule them all, and can help you report cryptocurrency taxes.

In this past year, cryptocurrency investment has skyrocketed. The total market cap rose over 1000 percent, even breaking a record and climbing over $600 billion in December.

Coinbase, the most popular online platform for buying and selling digital currency, gained one million users in one month alone.

Cyrptocurrency’s increasing popularity led to changes in IRS rules.

Although cryptocurrency investors were previously able to use the “like-kind” tax code exemption, the IRS now says digital investments must be taxed as short and long-term capital gains.

Back in 2015, only 802 Americans reported Bitcoin related gains and losses. At the time, cryptocurrency could technically be categorized a property instead of income. The 2017-18 year should show a greater increase in reports due to the new IRS regulations.

It can be difficult to determine how to report your taxes, and many other available tools victimize you with information overload. Understanding your tax liability is no fun at all, but it’s not something you’d want to get wrong unless tax jail sounds exciting.

The newly minted Token Tax does the work for you, integrating directly with Coinbase’s API to import all your investments in an easy to read format that’s directly exportable to the IRS. Kraken, Bittrex, and GDAX are also securely integrated with the platform.

Using FIFO, Token Tax calculates your tax liability and displays it in an easy to read interface. You can then export a fill-out 8949 form directly to your accountant or the IRS for review.

Creators Alex Miles and David Holland Lee say they believe Token tax “could be the TurboTax for crypto.”

Even though Token Tax is still in test mode, not even beta, it caught our attention by winning first place overall in Product Hunt’s Global Hackathon.

If you have invested in cryptocurrency and want to get ahead of the curve for tax season, check out their demo and see for yourself.

This story was first featured here in January of 2018.

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