A high-ranking official from the Internal Revenue Service (IRS) has expressed his expectation of an increase in cryptocurrency-related tax violation cases.
In a recent interview with CNBC, Guy Ficco, the IRS’s Chief of Criminal Investigation, revealed that crimes involving the failure to report income earned from trading digital assets are becoming more prevalent.
Ficco stated, “What we are observing more frequently now, and what constitutes a larger portion of our current caseload, are pure crypto tax crimes. These fall under Title 26, which refers to federal income tax violations specifically related to cryptocurrency.”
He further explained that these crimes may involve individuals not reporting income generated from crypto sales or attempting to conceal the true basis of their crypto assets. Ficco predicts that there will be an increase in Title 26 crypto cases this year and in the future.
Ficco also emphasized the importance of collaboration between the public and private sectors in tracking crypto-related crimes. Private companies like Chainalysis, which possess the necessary expertise and tools to trace the ownership of crypto assets, have been instrumental in assisting law enforcement agencies.
Ficco praised Chainalysis and other partners, stating, “Chainalysis, along with several other partners, have been very helpful to us and other law enforcement agencies in cracking the code. The partnership aspect of public and private sectors is crucial in this regard…”
He acknowledged that IRS special agents, who have accounting degrees and excel at tracing and following money, require additional tools and applications to investigate crypto-related crimes. Companies like Chainalysis provide expert support by offering these tools and applications, enabling special agents to determine if a crime has been committed.
It is evident that the IRS is relying on the expertise of private companies to combat the challenges posed by the crypto world and ensure the enforcement of tax laws.
The Daily Hodl does not provide investment advice, and investors are urged to conduct their own research before engaging in high-risk investments in Bitcoin, cryptocurrency, or digital assets. Transfers and trades are carried out at the individual’s own risk, and any resulting losses are the responsibility of the investor. The Daily Hodl does not endorse the buying or selling of cryptocurrencies or digital assets, nor does it provide investment advisory services. It should be noted that The Daily Hodl engages in affiliate marketing.