IRS Crackdown On Coinbase Users Who Are Dodging Their Tax
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A specialised Californian tax company, the tax office of David W Klasing has recently issued a public release stating the United States internal revenue service (IRS) is cracking down seriously with users on the Coinbase platform.
The dual-licensed tax lawyers employed at the company say that they have been tracking an increase in IRS enforcement activity against users on the platform who are not complying with their requirements for tax and reports.
The company has heeded a warning saying people who are not paying the tax on the platform “end up facing serious civil and criminal trouble down the line”. They further say:
“If you have failed to report holding Bitcoin or other virtual currencies on your past returns or filed an incomplete or misleading picture of your cryptocurrency holdings, the time to act to correct this is now. Once an audit or criminal tax investigation has begun, it will be too late to amend your returns or take advantage of a voluntary disclosure program.”
A transparency report was released by the exchange earlier this year in October which was highlighted by the law company saying that it should “serve as a major wake-up call“ to users of the exchange.
For those that don’t know, this report clearly indicated that both the IRS and its criminal investigation unit were filing information requests with the platform.
The uptick in the enforcement activity against Coinbase uses from the IRS on those who don’t their taxes would appear to confirm that the exchange is cooperating closely with federal authorities in the United States as the company has further said:
“This data [in the October report] makes it clear that the IRS is requesting information from Coinbase for the express purpose of checking it against its own taxpayer data and looking for discrepancies where holdings on Coinbase have not been reported on taxpayers’ returns.”