The Internal Revenue Service ( IRS) is beginning to shift its attention to cryptocurrencies, and it is updating the tax laws on bitcoin or other cryptocurrencies. In fact, by placing this question on the front page, the IRS plans to alter the standard 1040 form: “Did you sell, receive, send, trade, or otherwise gain any financial interest in any virtual currency at any time during 2020?” The taxpayer must check the “Yes” or the “No” box.

The crypto question first appeared on the 2019 tax form

The cryptocurrency issue first emerged on the 2019 tax form, although not all filers had to address the return section. The new placement is unparalleled, said Ed Zollars, a CPA with Kaplan Financial Education, which will make it easier for the IRS to win cases against taxpayers who check ‘No’ when they should check ‘Yes.’

The IRS makes it much more challenging to argue ignorance of the rules by adjusting the location of the crypto query and making all 1040 filers respond to it.

The IRS is taking cryptocurrencies seriously as a threat to the tax system.

The charge to the crypto topic and other recent acts indicate that the IRS takes cryptocurrencies seriously as a danger to the tax system, whether it is a non-compliance by a technical person or by advanced foreign criminals. The IRS is right, say, specialists, to be concerned about disobedience. As of July, 35 million total accounts were published by Coinbase.

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