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As the deadline for U.S. citizens to file their taxes looms on April 15, the United States Internal Revenue Service (IRS) is bracing for a significant increase in cases of crypto tax fraud and evasion.
Guy Ficco, the chief of criminal investigation at the IRS,<a href="https://www.cnbc.com/video/2024/04/12/irs-criminal-investigation-chief-agency-prepared-crypto-tax-crimes-cnbc-crypto-world.html" rel="noopener noreferrer nofollow"> spoke</a> to CNBC at the Chainalysis Links event in New York, highlighting the agency’s readiness to address the uptick in tax-related crypto crimes.
As reported earlier by TheCoinRise, the IRS was accused by<a href="https://thecoinrise.com/zachxbt-accuses-irs-of-harassment-seeking-assistance/" rel="noopener noreferrer nofollow"> prominent blockchain investigator ZachXBT of harassment</a>. The investigator said that the agency overstepped his “personal boundaries” in their pursuit of his assistance in solving blockchain-related crimes.
<h2 id="span-style-font-weight-400-irs-witnessing-a-rise-in-crypto-tax-fraud-span">IRS Witnessing a Rise in Crypto Tax Fraud</h2>
The IRS chief emphasized that there would be a notable rise in cases of tax fraud and evasion under Title 26 of the tax code, which pertains to willful tax evasion through misrepresentation or concealment of reporting documents.
While crypto has historically been associated with financial crimes like fraud and money laundering, Ficco noted a recent surge in “pure crypto tax crimes,” such as failure to report income from crypto sales and concealing the true basis of crypto assets.
<h3 id="span-style-font-weight-400-collaboration-with-chainalysis-span">Collaboration with Chainalysis</h3>
To tackle this trend, the IRS has collaborated with blockchain analysis firm Chainalysis and other law enforcement agencies to enhance its capabilities in tracking and cracking down on crypto-related offenses.
Ficco outlined some essential guidelines for<a href="https://thecoinrise.com/irs-claims-crypto-staking-rewards-are-taxable/" rel="noopener noreferrer nofollow"> taxpayers to ensure compliance with tax regulations</a>, stressing the importance of accurately reporting crypto transactions. He explained that taxpayers should determine the basis of their assets and report gains or losses accordingly when disposing of them.
For instance, if someone acquires a crypto asset for $10,000 and sells it for $20,000, they would need to pay tax on the $10,000 gain.
<h2 id="span-style-font-weight-400-irs-has-become-more-aggressive-span">IRS has Become More Aggressive</h2>
Ficco emphasized that the IRS has become more aggressive in investigating and prosecuting individuals who fail to<a href="https://thecoinrise.com/joe-biden-pushes-for-30-crypto-mining-tax-once-again/" rel="noopener noreferrer nofollow"> report crypto taxes</a> or intentionally provide false information on their tax returns.
The increased scrutiny of crypto tax compliance was underscored by a recent indictment of a Texas man, Frank Richard Ahlgren III, who was charged with filing false tax returns and evading reporting requirements on over $4 million in gains from Bitcoin transactions.
As the IRS gears up to tackle crypto tax crimes, taxpayers are urged to ensure accurate reporting of their crypto activities to avoid potential penalties or legal consequences.
The post <a href="https://thecoinrise.com/irs-prepares-for-surge-in-crypto-tax-crime-cases/" rel="noopener noreferrer nofollow">IRS Prepares for Surge in Crypto Tax Crime Cases</a> appeared first on <a href="https://thecoinrise.com" rel="noopener noreferrer nofollow">Latest News and Insights on Blockchain, Cryptocurrency, and Investing</a>.

IRS Prepares for Surge in Crypto Tax Crime Cases

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