Operation Hidden Treasure’ initiated by the IRS to Root Out Unreported Crypto Income

[av_one_half first min_height=” vertical_alignment=” space=” row_boxshadow=” row_boxshadow_color=” row_boxshadow_width=’10’ custom_margin=” margin=’0px’ mobile_breaking=” border=” border_color=” radius=’0px’ padding=’0px’ column_boxshadow=” column_boxshadow_color=” column_boxshadow_width=’10’ background=’bg_color’ background_color=” background_gradient_color1=” background_gradient_color2=” background_gradient_direction=’vertical’ src=” background_position=’top left’ background_repeat=’no-repeat’ highlight=” highlight_size=” animation=” link=” linktarget=” link_hover=” title_attr=” alt_attr=” mobile_display=” id=” custom_class=” aria_label=” av_uid=’av-6gjy1z’] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-kij8lemh’ admin_preview_bg=”]

Operation Hidden Treasure’ initiated by the IRS to Root Out Unreported Crypto Income

[/av_textblock] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-kij8lemh’ admin_preview_bg=”] The U.S. Internal Revenue Service (IRS) appears to be stepping up its enforcement capabilities with a new program dedicated to cryptocurrency tax compliance.
[/av_textblock] [/av_one_half] [av_one_half min_height=” vertical_alignment=” space=” row_boxshadow=” row_boxshadow_color=” row_boxshadow_width=’10’ custom_margin=” margin=’0px’ mobile_breaking=” border=” border_color=” radius=’0px’ padding=’0px’ column_boxshadow=” column_boxshadow_color=” column_boxshadow_width=’10’ background=’bg_color’ background_color=” background_gradient_color1=” background_gradient_color2=” background_gradient_direction=’vertical’ src=” background_position=’top left’ background_repeat=’no-repeat’ highlight=” highlight_size=” animation=” link=” linktarget=” link_hover=” title_attr=” alt_attr=” mobile_display=” id=” custom_class=” aria_label=” av_uid=’av-4pizyf’] [av_image src=’https://vcpa.com/wp-content/uploads/2021/03/IRS-Bitcon.jpg’ attachment=’1626′ attachment_size=’full’ copyright=” caption=” styling=” align=’center’ font_size=” overlay_opacity=’0.4′ overlay_color=’#000000′ overlay_text_color=’#ffffff’ animation=’no-animation’ hover=” appearance=” link=” target=” id=” custom_class=” av_element_hidden_in_editor=’0′ av_uid=’av-kij8njkq’ admin_preview_bg=”][/av_image] [/av_one_half] [av_hr class=’default’ icon_select=’yes’ icon=’ue808′ position=’center’ shadow=’no-shadow’ height=’50’ custom_border=’av-border-thin’ custom_width=’50px’ custom_margin_top=’30px’ custom_margin_bottom=’30px’ custom_border_color=” custom_icon_color=” av-desktop-hide=” av-medium-hide=” av-small-hide=” av-mini-hide=” id=” custom_class=” av_uid=”] [av_textblock size=” av-medium-font-size=” av-small-font-size=” av-mini-font-size=” font_color=” color=” id=” custom_class=” av_uid=’av-kij8ukp4′ admin_preview_bg=”] With “Operation Hidden Treasure,” the IRS will search for unreported crypto-related income, according to the agency’s Director of the Office of Fraud Enforcement, Damon Rowe.

• Speaking at a Federal Bar Association virtual tax conference, Rowe said cryptocurrency fraud will be a priority.
• Operation Hidden Treasure, a joint effort between the IRS’s civil office of fraud enforcement and its criminal investigation unit, will train agents to look at blockchains to root out tax evasion among cryptocurrency users. It will exist as part of the office’s emerging threats mitigation team.
• IRS employees are also reportedly training alongside the European Union Agency for Law Enforcement Cooperation (Europol) as part of the initiative.
  Carolyn Schenck, national fraud counsel in the IRS Office of Chief Counsel, told conference-goers that the agency is working with private contractors and vendors, presumably blockchain analytics firms, to develop “signatures,” or telltale signs of fraudulent activity.

These indicators include looking at those who structure transactions just below reporting requirements (like sending a series of $10,000 transactions), using shell corporations to hide funds as well as “getting on and off the chain,” Schenck reportedly said.

• The IRS has sent conflicting messages to U.S. crypto holders several times in the past. Most recently, an updated FAQ page indicated that investors who simply bought “virtual currency with real currency” would not have to report that transaction on this year’s tax returns.
• Still, cashing out crypto or making every-day purchases is typically seen as a taxable event. Operation Hidden Treasure is designed to find, trace, and attribute such transactions to taxpayers, Schenck said.

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