New Bitcoin Millionaires Are Avoiding the IRS
But despite the colossal gains and surge in new-fangled Bitcoin millionaires, few investors seem to be reporting their cryptocurrency windfalls on their U.S. tax returns. And experts warn this could mean huge penalties down the line.
Only 802 individuals reported gains from Bitcoin-related transactions (shown on Form 8949) on their tax returns in 2015, according to an affidavit from IRS agent David Utzke, filed in U.S. District Court earlier this year. This is a tiny fraction of the 150.7 million individuals who filed returns that year.
"The IRS figures hundreds of thousands of American residents did not report income from sales or exchanges of cryptocurrency and they might be able to collect several billion dollars in back taxes, penalties and interest,"