The investigations chief of the US Internal Revenue Service (IRS), Guy Ficco, said the agency expects to see a rise in crypto tax evasion cases this year.
Guy Ficco, chief of the United States Internal Revenue Service (IRS) criminal investigation, spoke to CNBC at the recent Chainalysis Links event, saying the agency expects to see more crypto-related tax evasion crimes this year.
Rise in “Pure Crypto Tax Crimes”
Guy Ficco, head of criminal investigations at the US Internal Revenue Service (IRS), said there is a rise in the number of “pure” tax evasion crimes related to cryptocurrencies. In a video with CNBC, Ficco told the news agency that it is seeing more “pure crypto tax crimes.” Ficco says the rise is attributed to crypto being previously used mainly for more severe fraud crimes, including embezzlement and scams.
In the video with CNBC, Ficco explains to US citizens how crypto holding can affect tax obligations. The criminal investigation chief explained:
“This could be purely not reporting income generated from crypto sales, it could be hiding the true basis of crypto.”
Adding;
“There’s going to be a lot more charged Title 26 crypto cases this year and moving forward.”
Title 26 tax codes are citizens who willfully evade paying taxes by misrepresentation and wrongly reporting on tax documents.
Ficco says the agency expects to charge crypto tax evasion matters more aggressively from this season going forward after the tax filing deadline ended on April 15.
Help From Companies Such as Chainalysis
To help track delinquents, the IRS enlisted the assistance of several partners, including blockchain analytics firm Chainalysis. Ficco said:
“My IRS special agents are phenomenal at tracing and following money, but some of the tools and applications that are needed in the crypto world – that’s where the experts at Chainalysis come in.”
The chief of investigation explained crypto tax reporting very simply, stating:
“The basic rule of thumb is that you have a basis in the asset. When you dispose of that asset […] the point where you sold is your disposition. If you acquire something at $10,000 and you sold it for $20,000 — you have a $10,000 gain and that’s what you need to pay tax on.”
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
