IRVINE, Calif., Feb. 20, 2020 /PRNewswire/ -- Cryptocurrency is
one of the hottest topics in IRS civil and criminal tax
enforcement. The IRS has been very vocal about its willingness to
criminally investigate and prosecute taxpayers who are willfully
noncompliant in reporting such cryptocurrency income. This article
explores considerations for taxpayers looking to come into
"crypto-compliance".
https://youtu.be/8oSCndQSgR4
Ramping-Up of Cryptocurrency Enforcement Actions
The updated Form 1040 for 2019 now includes a question on
Schedule 1 inquiring as to whether the taxpayer received, sold,
sent, exchanged, or otherwise acquired a financial interest in
virtual currency in 2019. It serves as a glaring notice to
taxpayers that the IRS is holding them accountable to accurately
and truthfully report cryptocurrency transactions.
The IRS has not been shy about using their toolbox of
investigatory weapons to weed out those who are not truthfully
reporting cryptocurrency transactions. In 2016, the IRS fought
tooth and nail in federal court to demand records from Coinbase, a
California-based virtual currency
exchange. In that case, the IRS was not even looking for any one
taxpayer, specifically. The Service simply issued a summons for a
mass amount of data on Coinbase's customers. Other coin
brokerages are thought to have also received John Doe
Summonses.
The IRS Criminal Investigation unit has made it known that
virtual currency tax enforcement is one of their top priorities for
2020 and beyond.
Coming into Crypto-Compliance
If you would have to include $30,000 or more (one year in jail under the
federal sentencing guidelines) of additional federal income tax on
one or more amended federal tax returns to pick up your previously
omitted crypto trading and there are badges of fraud in your fact
pattern and you are seeking a nearly guaranteed pass on criminal
tax prosecution, you should discuss an IRS Criminal Investigation
Voluntary Disclosure with an experienced and qualified criminal tax
defense attorney.
If you are under audit and have substantial unreported
cryptocurrency transactions in your fact pattern, you are facing an
eggshell audit and should hire a criminal tax defense attorney to
represent you.
See the full version of this article HERE.
Public Contact: Dave Klasing Esq.
M.S.-Tax CPA, dave@taxesqcpa.net
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SOURCE Tax Law Offices of David W.
Klasing, PC