Following this week’s news that the IRS will begin cracking down on taxpayers who didn’t report Bitcoin earnings on this year’s tax returns, tax relief firmPlatinum Tax Defenders has announced its plans to assist those who need help amending tax returns or paying back taxes. According to the news that broke this week, the IRS will begin cracking down on cryptocurrency traders who didn’t report their earnings on their taxes. By the end of August, the IRS will reportedly send approximately 10,000 taxpayer letters asking them to pay back taxes on unreported profits from cryptocurrency trading, according to a report in Engadget.com.
The IRS began monitoring virtual currency as early as last year with the launch of a Virtual Currency Compliance campaign to address noncompliance related to the use of virtual currency.
The IRS statement from July 2018 regarding the crackdown on cryptocurrency trading read, “U.S. persons are subject to tax on worldwide income from all sources including transactions involving virtual currency.” The announcement continued that “taxpayers with unreported virtual currency transactions are urged to correct their returns as soon as practical.”
The IRS started sending letters containing more information on reporting Bitcoin gains last week to 13,000 individuals whose contact information it acquired from “various ongoing compliance efforts” conducted by the IRS.
In a statement from the IRS on July 26, Commissioner Chuck Rettig said, “Taxpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest, and penalties.” Commissioner Rettig continued that the IRS is “expanding our efforts involving virtual currency, including increased use of data analytics.” Rettig concluded that the IRS is “focused on enforcing the law and helping taxpayers understand and meet their obligations.”
Platinum Tax Defenders has announced it will offer free consultations to taxpayers that did not accurately report their earnings through cryptocurrency trading. Taxpayers that did not report their profits will be held liable for the tax for those earnings as well as any penalties and interest. The IRS also noted that in some severe cases, those who have not paid taxes on cryptocurrency earnings might face criminal prosecution.
For those taxpayers who received a letter from the IRS last week, or who experienced earnings from bitcoin that should have been reported on this year’s taxes, should contact Platinum Tax Defenders immediately. The experienced team of tax relief professionals at top tax defenders can help those affected taxpayers with filing amended tax returns, settling any back taxes owed, and, if needed, attempt to seek the removal of any penalties incurred as a result of not reporting bitcoin earnings.