Countries taking a strict stance on crypto tax evasion

In the past year, bitcoin and other cryptocurrencies gained popularity among investors around the world. Cryptocurrencies exist as virtual tokens that allow investors to electronically transfer assets in a secure way using digital technology. However, they can present a multitude of issues when it comes time to report taxes.

Many crypto investors are unaware that the IRS requires taxpayers to report bitcoin earnings and losses when filing their taxes. According to the IRS, almost 40 percent of Bitcoin investors will commit tax fraud in 2018. Countries across the world are beginning to take a strict stance on crypto tax evasion.

Earlier this month, Japan announced a new system that will help catch investors who do not report crypto earnings on their tax forms. The system will allow the Japanese government to access a crypto transaction report for a person suspected of tax evasion. The reports will also provide names and addresses for individuals involved in the digital transactions. This is troubling to many crypto investors.

Israel quickly followed in Japan's footsteps. In the past few weeks, the Israeli government has brought hundreds of cases to court involving crypto investors who failed to report earnings. Additionally, Spain is in the process of monitoring over 15,000 crypto investors to ensure they are filing their taxes correctly.

The IRS is continuing its efforts to prevent crypto tax evasion in the United States. Unfortunately, filing taxes for cryptocurrencies can be confusing for even the most honest investors. The government requires taxpayers to report capital tax gains based on the "original value of the asset."  However, this is not always clear in a crypto transaction, and people can easily fall into tax evasion.

The government can penalize crypto tax evasion the same as failing to report any other earnings. These penalties can involve severe fines and several years in jail. It can be beneficial to speak with an experienced tax attorney if you have crypto assets to make sure you file your taxes properly and avoid any penalties.

No Comments

Leave a comment
Comment Information

Contact Kundra and Associates Today

Please call our offices at 301-637-8130 or fill out the form below to arrange a confidential consultation.

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Email Our Attorneys

Rockville Office
110 North Washington Street
Suite 406
Rockville, MD 20850

Phone: 301-424-7585
Fax: 301-424-7047
Rockville Law Office Map

Washington, D.C. Office
1025 Connecticut Avenue NW
Suite 1000
Washington, DC 20036

Phone: 301-637-8130
Fax: 301-424-7047
Map & Directions

Mumbai, India
C/o Anmol Sekhir Consultants Pvt. Ltd.
Chartered Accountants
3rd Floor, Sahakar Bazar
Opposite Railway Station
Bandra (West), Mumbai, India 400-050

Phone: 301-637-8130
Map & Directions