If you are in Beverly Hills, California, and are not reporting the income from cryptocurrency transactions (“crypto income”) on your tax return, please note that the Biden administration and the Internal Revenue Service (“IRS”) will be looking for you.
In calling for expanded broker information reporting with respect to cryptocurrency assets, the Biden administration, through the Treasury Department, in its “General Explanations of the Administration’s Fiscal Year 2022 Revenue Proposals”, recently stated:
“Tax evasion using crypto assets is a rapidly growing problem. . . . The global nature of the crypto market offers opportunities for U.S. taxpayers to conceal assets and taxable income by using offshore crypto exchanges and wallet providers.”
This attention that the Biden administration is giving to unreported crypto income for tax purposes is consistent with an increased focus by the IRS on unreported crypto income.
First, the IRS has established “Operation Hidden Treasure”, consisting of IRS investigators and enforcement persons who are examining fraud and criminal violations arising from unreported crypto income.
Second, the IRS has contracted with cryptocurrency tax service provider, Tax Bit, to help the IRS with tax audits concerning cryptocurrency tax issues, including concerning unreported crypto income.
These governmental concerns with unreported crypto income are derived from the tax treatment of cryptocurrency by the IRS as a form of property.
If you buy cryptocurrency and then sell it for a profit, the profit is treated as crypto income that must be reported on your tax return.
The IRS also regards cryptocurrency that is received (1) as payment for performing work on the blockchain ledger in a cryptocurrency “mining” transaction or otherwise for services, (2) from a company for its promotional or marketing purposes in a cryptocurrency “airdrop” transaction, or (3) in exchange for selling goods (if greater than your tax basis in the goods), in each case,as crypto income that must be reported on your tax return.
If Beverly Hills taxpayers fail to report crypto income, they will face various adverse consequences.
They will be subject to interest liability and penalty liability on their unreported crypto income.
They will face possible tax audits, bank levies, wage garnishments, and asset seizures and forfeitures as a result of their unreported crypto income.
They will have the potential for criminal punishment, including fines and incarceration, from their unreported crypto income.
Unreported crypto income cases are complicated and require the assistance of skilled tax professionals who know both what to do and what not to do to best represent taxpayers in their dealings with the IRS. Your unreported crypto income case requires the assistance of Leading Tax Group.
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Our experts will educate you in the mistakes made previously to help avoid getting into a similar mess in the future.
Leading Tax Group is very familiar with the intricacies and nuances associated with cryptocurrency. Moreover, Leading Tax Group has had many prior cases of representing Beverly Hills taxpayers and resolving unreported income problems.
Given these facts, Leading Tax Group is an outstanding choice to represent people and businesses in Beverly Hills in their unreported crypto income matters.
Leading Tax Group has an office for its Beverly Hills clients in Beverly Hills at 9440 Santa Monica Boulevard, Suite 301.
If you want to reduce the problems arising from unreported crypto income (given the increased attention by the Biden administration and the IRS on cryptocurrency tax issues), and live in the Beverly Hills area, you need the aggressive and experienced tax representation of Leading Tax Group. Contact Leading Tax Group now!
read more Contact UsHeadquartered in Encino, California with multiple local branch offices in your backyard to serve you at your convenience. Leading Tax Group can schedule a face to face consultation to represent your case with the IRS, FTB, EDD, as well as CDTFA Audits.
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