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New orders to IRS: More crackdown on crypto traders?

IRS
TL;DR Breakdown
  • IRS set to crackdown on crypto tax defaulters
  • The agency wants to involve all traders in tax payments
  • Rettig thumbs up the John Doe Summons

The United States IRS has been ordered to investigate crypto traders that have fallen short of their duties of paying taxes on their digital assets. The market has grown considerably over the years, with more participants entering the sector across the United States. The new update is an effort pulled by the government to help the agency collect crypto tax in the easiest possible ways. According to the update, the agency is allowed by law to invite taxpayers who do not pay crypto taxes.

IRS wants crypto traders involved in tax payments

The update was delivered in a joint statement by IRS boss Charles Rettig, including Damian Williams, an attorney in the US. The statement mentioned that the body was given the right to invoke a John Doe Summons on taxpayers who refused to remit their taxes.

The summon has also been used to order Safra Bank, a financial institution in the United States, to submit a comprehensive list of residents in the country that have failed to remit their taxes to the agency collecting them. The announcement mentioned explicitly that the body would first target crypto users trading on the SFOX exchange. According to the IRS, traders are not only liable to report when they have made profits or losses on assets but also to pay taxes related to their digital assets.

Rettig thumbs up the John Doe Summons

The US attorney assured that the government is pooling all its resources into finding all individuals within the age bracket of paying taxes and making sure they do so promptly. He mentioned that taxpayers must ensure that they pay taxes on all returns, which also includes digital assets. In the report, Rettig believes the Summons will help bring all crypto traders escaping taxes into the tax-paying fold.

Meanwhile, an analysis firm recently conducted a survey to determine what countries are ranked at the bottom regarding tax payments on digital assets. Belgium topped the list, with Iceland, Japan, and Israel following suit in no particular order. This month, Australia announced that it would open public consultation on the rollout of a new law that will exempt digital assets from being labeled under foreign currency regarding taxation. The consultation period is set to last 25 days, with the company revising an earlier crypto tax law if it is signed into law.

Owotunse Adebayo

Owotunse Adebayo

Adebayo loves to keep tab of exciting projects in the blockchain space. He is a seasoned writer who has written tons of articles about cryptocurrencies and blockchain.

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