Wait, your example seems a bit weird. If person A gets paid $1,000 BUSD for services rendered to company B, that's not transfer of property, that's definitely

Wait, your example seems a bit weird. If person A gets paid $1,000 BUSD for services rendered to company B, that's not transfer of property, that's definitely income and taxed as income at the appropriate income tax rate no matter if the compensation for services rendered was paid out in USD, BUSD, gold, goats or other services (e.g. barter of services according to https://www.irs.gov/taxtopics/tc420 https://www.irs.gov/taxtopics/tc420) - in all non-USD cases, you just use the USD value of the non-USD-thing, which should be simple for stablecoins. On the other hand, if BUSD is stable and does not grow in value, then short-term capital tax does not apply, since there are no capital gains. If person A was paid 1000 randomcoin that was worth $1000 at the time of payment, and by the time they needed to sell some of them to pay taxes they had doubled in value, then yes, they would have to pay 10% of the value increase as well. That sale/capital gains trigger would likely be in the next tax period, so the "recursive" tax would be due a year later than the "initial" tax.