In a earlier post, we defined how the U.S. Inside Income Service had launched a query on the 2020 tax kind that requested whether or not “at any time throughout 2020 did you obtain, promote, ship, trade, or in any other case purchase any monetary curiosity in any digital forex.” The aim of putting this query in a really distinguished a part of the tax kind was to attempt to gather among the important quantities of the unreported taxes surrounding crypto-currency transactions as a result of, underneath U.S tax regulation, digital forex is handled as property for Federal revenue tax functions. In a FAQ posted to the IRS web site on March 6, 2021, the IRS clarified that there isn’t a must reply that query affirmatively if the one factor a taxpayer did in 2020 was purchase cryptocurrency with fiat.
On the identical time, Forbes reported that, at a March 5, 2021 Federal Bar Affiliation presentation on fraud enforcement priorities, Damon Rowe, the Director of the Workplace of Fraud Enforcement on the Inside Income Service, introduced that the workplace had a brand new devoted crew of IRS Prison Investigation professionals who’re engaged on “Operation Hidden Treasure.” As Forbes defined, Operation Hidden Treasure “is comprised of brokers who’re skilled in cryptocurrency and digital forex monitoring, and who’re targeted on taxpayers who omit cryptocurrency revenue from their tax returns. . . . [it] is a partnership between the civil workplace of fraud enforcement and the prison investigation unit to root out tax evasion from cryptocurrency house owners.”