For most taxpayers facing an IRS cryptocurrency examination, the defining problem is asymmetry of information. The Revenue Agent on the other side of the table has access to exchange records produced through John Doe summonses, blockchain analytics that trace transactions across wallet addresses, expanded broker reporting under digital asset rules, and dedicated IRS training programs…
Continue reading ›For years, cryptocurrency holders operated on the assumption that the IRS could not see what was happening on the blockchain. That assumption was always wrong, and it is now demonstrably wrong. Through John Doe summonses served on major exchanges, sophisticated blockchain analytics partnerships, expanded reporting requirements, and a coordinated enforcement initiative that began with Operation…
Continue reading ›Quick answer: IRS Letter 6174 is a “soft” educational letter the IRS sends when it has information that you own or trade cryptocurrency and wants to be sure you reported it correctly. It does not require a response. That does not mean it is nothing. It means the IRS already has data on you, and…
Continue reading ›By Alex Kugelman, Founder and Managing Attorney, Kugelman Law Not all cryptocurrency audits are the same. Understanding the types of cryptocurrency tax audits the IRS conducts — and what typically triggers each — gives crypto investors, traders, miners, and businesses a meaningful head start in evaluating their exposure and their options. A correspondence audit and…
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