The United States tax authority doesn't seem to be very efficient when it comes to tracking down who owes crypto taxes - for now.
It would seem that even the U.S. Internal Revenue Service, or IRS, has a tough time figuring out who owes what, according to Wendy Walker, solution principal at the tax compliance company Sovos.
"In the typical tax system, the IRS uses 1099 reporting," Walker told Cointelegraph in an interview.
"So, 1099, W2, that tax reporting, it's the primary tool that they use to enforce tax compliance," she added.
When people fail to report their crypto activities, the IRS is left with a headache.
In 2019, 10,000 crypto-involved people received warning letters from the IRS, informing some folks that they owed money, or had incurred fines.
Others were told to add their crypto activities onto their reporting.
The tax authority also just recently added a question to the top of the 1040 form, asking filers if they handled crypto at all during the relative tax year.
" To combat this massive pile of data, in May 2020 the IRS publicized its request for proposal, or RFP - a search for digital asset-savvy persons to navigate the stacks of information, Walker mentioned.
"My point is that they go about it the hard way. This question on the 1040, this RFP for people to sift through information that was sent back, enforcement letters to tax payers - it's like they're throwing stuff out there to see what will stick."
How the IRS tracks down people who don't report their crypto
Publicado en Oct 30, 2020
by Cointele | Publicado en Coinage
Coinage
Noticias recientes
Ver todo
Blockchain Bites: Bitcoin's Run, Uniswap's Hemorrhaging Value, Anchorage's Banking Bid
Bitcoin is nearing all-time highs in price and market cap last set three years ago.
Japan's megabanks to lead experiment with digital yen
We have, in order, Cheese Bank with a $3.3 million theft, Akropolis with its $2 million loss, Value DeFi with a whopping $6 million exploit and finally Origin Protocol's loss of $7 million.
Number of new Bitcoin addresses spikes amid growing FOMO
Japan's three largest banks, as part of a group of 30 private sector actors, are set to collaborate on an experiment with a digital yen.
Not just Wall Street: Quant trader explains why Bitcoin price is going up
Sam Trabucco, a quantitative trader at Alameda Research, believes four general factors are pushing up the price of Bitcoin.