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Friday, Oct 02, 2020

The IRS Knows All About Your Secret Bitcoin Trades

The only thing that’s certain in life is death and taxes. For buyers of Bitcoin and other cryptos, the latter has come, as the IRS is now pumping out an avalanche of notices to more than 10,000 cryptocurrency investors who probably haven’t been upfront about their trades. The source of this is Coinbase, which submitted reports for 13,000 accounts under compulsion from a federal court order.

There are probably going to be a lot of worried Bitcoin fans waiting by their mailbox, but the reality is perhaps less severe. According to an article on Forbes, the mail campaign has all the hallmarks of a “scattergun” approach, suggesting that the taxman is not necessarily interested in following up with every individual they reach out to.

Perhaps due to Bitcoin’s relatively unknown status for the majority of its existence, crypto largely escaped the taxman’s watchful eye for several years. That changed after the mammoth 2017 bull run.

The IRS is most interested in any Coinbase accounts whose transaction history exceeds $20,000.

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