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IRS Asking Congress to Bolster Its Crypto Enforcement Authority

IRS Asking Congress to Bolster Its Crypto Enforcement Authority

Author: Jeffrey R. PittardDate: June 29, 2021

The Internal Revenue Service (IRS) is continuing its cryptocurrency crackdown. Earlier this month, the agency asked Congress for additional funding and greater legal authority to bolster its efforts to regulate cryptocurrencies and increase tax compliance.

As discussed in prior posts, virtual currency is treated as property for federal tax purposes. Accordingly, the sale or exchange of convertible virtual currency, or the use of convertible virtual currency to pay for goods or services in a real-world economy transaction, may have tax consequences that may result in a tax liability. However, the IRS contends that many taxpayers are shirking their tax obligations when it comes to crypto transactions.

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