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If you made a profit on Cryptocurrency, Beware! IRS is coming for you

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Jai Pratap
A Mass Media Graduate who loves to write. Jai is also a sports enthusiast and a big movie buff. He loves to learn new things.

The Internal Revenue Service (IRSI on Friday announced that they are sending letters to people who have made profits from crypto trading. IRS claimed that virtual currency traders have failed to report their revenues correctly. IRS Commissioner Chuck Rettig asked taxpayers to take these letters seriously and review their tax filings. He also mentioned if you are behind on your taxes pay appropriate interests and penalties.

IRS sends letters to 10,000 cryptocurrency owners 

The IRS is expanding its efforts involving cryptocurrency and evolving use of data analytics he added. The IRS has sent letters to over 10.000 taxpayers over tax evasion earned over revenues through crypto trading.

The IRS identified thousands of cryptocurrency trader through what they call their “ongoing various efforts.” The recipients of letters have come out on social media, and according to them, some letters are a simple warning to file their investments properly. But some letters are warning of possible noncompliance with US tax law, and they can be audited. IRS is focused on enforcing the law and helping taxpayers understand and meet their obligations said Chuck Retting.

IRS might have used coinbase data to send letters

The IRS began working on its guidelines for cryptocurrency last year. Industry advocates have criticized IRS decision to include virtual currency as intangible property for tax purposes. According to a Forbes report by crypto tax attorney Tyson Cross, IRS might be using the list of taxpayers that they acquired from Coinbase in last year.

As cryptocurrency continues to face scrutiny from the regulators in the USA, now IRS has also come into action by sending a scare to thousands of crypto traders in the name of “taxpayer obligation.”

Disclaimer: Coinnounce's views are not necessarily reflected in the articles published, and they are the sole representation of the author's opinions. Article's information should not be taken as investment advice. Risks are involved in cryptocurrency investments and trading. Readers are urged to carry out extensive research before making a decision.

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