IRS Cryptocurrency Letters

By
Services for Real Estate Pros with Backoffice Squared

I represent taxpayers in Gainesville and the state of Florida who have tax issues with the IRS and Florida Department of Revenue. The IRS has released several thousands of notices to taxpayers regarding cryptocurrency transactions. What the heck is this all about?

I know, we all thought that cryptocurrencies where all about secrecy. We used to think the same thing in the past about Swiss Banks, but that turned out to not be the case. In the cryptocurrency case, the IRS has issued John Doe Summons to organizations such as Coinbase that has apparently resulted in the release of names on accounts and perhaps some specific transaction information. Additionally, the IRS has access to all kinds of databases that might give them a clue as to who is doing what in the cryptocurrency world. This means that if you receive one of the three types of cryptocurrency IRS letters, you had better assume that they know something.

IRS Letter 6174 and its cousin IRS Letter 6174-A do not require a response. However, the IRS is putting the Taxpayer on Notice that cryptocurrency transactions must be reported. This takes away the defense of “I didn’t know”.

IRS Letter 6173 is the big deal. It requires a response by a specific date and that response must include the taxpayer’s signature that all answers are correct and true. This means that any half-ass answer could result in criminal actions for lying if nothing else. It would be a good idea to work with an attorney to get this response right.

If you or someone you know has received a Notice of Intent to Levy or some other federal or state tax issue, please feel free to contact me at either (352) 317-5692 or email jim@backoffice2.net.

 

Jim Payne, CPA

Backoffice2

Gainesville, FL

Cell (352) 317-5692

Office (352) 376-9401

Fax (352) 376-9440

jim@backoffice2.net

https://backoffice2.net

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Jim Payne, CPA

CPA firm practicing in the area of IRS Collections
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