IRS Action Reveals Sluggishness in Tax Compliance of Bitcoin Users

New York, NY – Bitcoins and cyrptocurreny aren’t really to be seen as just a medium of exchange. IRS has made it clear that digital currency is like property and thus transactions are subject to taxation. The IRS has also begun to uncover the identities of bitcoin users who default on tax payments.

Although cryptocurrency attracts buyers due to its anonymity, there is still tax to be paid. This realization is yet to catch up, and the reports of a recent IRS action involving use of software to uncover identities suggests so. The majority of bitcoin transactions are expectedly not reported, and this number is in millions. The value of bitcoins itself has grown from two digits to four in the recent past.

“If cryptocurrency is treated as property, than a host of transactions come under the tax net. Users of digital payments appear to be resilient in protecting its anonymous nature, so it will be interesting to watch out how this space evolves in the near future,” said Strahan McNeil.

Among the things that can get taxed if digital currencies are used are employee wages, payments to contractors, and any profits or losses incurred while trading crypto currencies as property.

Strahan McNeil Partners is a New York headquartered finance firm which operates a global network of over 560 finance professionals redefining their traditional role as ‘financial technicians’. The firm offers specialized financial services that handles audits, restructuring, structured finance, and mergers and acquisitions. Focused on turning knowledge into value and advantage for its clients, Strahan McNeil Partners provides clients with wide ranging financial and accounting services that meet globally consistent norms.

Strahan McNeil Partners is today playing a new role in the capital markets, supporting positive reforms that would strengthen credibility and confidence. The firm actively takes up social responsibility, making it part of its central, working agenda so as to make a real difference to the communities it serves.

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