Biden Sends Tax Man To US Crypto Investors
Last Updated on 16 May 2021 by CryptoTips.eu
US President Joe Biden is riding high on a wave of popularity for the moment. With his successful battle against Covid so far and his numerous stimulus bills, he’s seeing surging approval both on the Democratic and Republican side.
So much so that he can risk doing unpopular things on the side. For example, sending his finance department to look for tax frauds who haven’t paid taxes on their crypto revenue.
Stimmy and Stonks
The younger US generation of workers who received stimulus cheques (or stimmy as they called it) didn’t immediately invest it in stocks (or stonks as they called it) but rather went looking for ways to get rich with Bitcoin (or even Dogecoin in the last few months).
Realizing that some 10% of the stimulus cheques sent out were invested into crypto, the Biden administration had not much choice but to go and look for those who’ve made healthy profits this year.
With the official US tax day fast approaching, Americans need to read up on taxes on their crypto earning fast, as avoiding this could land them with a hefty bill. Showing his hand exactly, the White House ordered the Internal Revenue Service (IRS) to go after popular crypto platforms and ask them for their customer data.
In fact, a few weeks ago, a federal judge in San Francisco had no choice but to approve an IRS summons and ask the big platform Kraken to hand over their records. The demand applies, according to the Wall Street Journal, to customers who had more than $20,000 in transactions in any year from 2016 through 2020.
Don Fort, a lawyer with Kostelanetz & Fink, commented:
With these summonses and other actions, the IRS is mounting a full-court press to show taxpayers how seriously it takes cryptocurrency compliance. Taxpayers should take it seriously too.
Just as in Britain, where the government handed out almost free money in terms of furlough payments and stimulus to companies, the US government is seeking to get some of the crypto winnings back to fill up the hole in their coffers.