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IRS formed a new team for tracking down the evaders of the cryptocurrency tax

The United States Internal Revenue Service (IRS) formed a new team comprised of 10 members whose goal is to investigate international crimes, as well as to track down the evaders of the cryptocurrency tax.

Chief of the IRS Criminal Investigation Division, Don Fort, said to Bloomberg the team would cooperate with agencies for international criminal to investigate unlicensed cryptocurrency exchanges: “It’s possible to use Bitcoin and other cryptocurrencies in the same fashion as foreign bank accounts to facilitate tax evasion.” According to Fort, the focus of the new team for the time being is on the ways fiat currencies are changed into cryptocurrencies: “We know that you want to get your money out at some point.”

In March, 2014 the IRS started issuing guidelines for the taxation of cryptocurrencies, which were treated for tax purposes as a property with capital gains or capital losses. However, only 802 people mentioned their capital gains or losses coming from cryptocurrencies in their tax declarations for 2015.

The IRS is facing obstacles this year by trying to gain access (through a court order) to user information of the American largest cryptocurrency exchange, Coinbase. The IRS originally requested records of more than 500,000 users, but this request was denied by courts. Afterwards, this number was decreased to only 14,000 users that allegedly had high trading activity of more than 20,000 dollars.

Coinbase saw this as a partial victory in the fight to maintain user privacy and a possible precedent for the dealings between the tax authorities and the cryptocurrency exchanges in the country.

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