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Jul 26

The Internal Revenue Service has begun sending letters to more than 10,000 cryptocurrency holders, warning about penalties for failing to report income and pay tax on transactions involving virtual currencies. From a report: The agency expects its mailing to be completed by the end of August [Editor’s note: the link may be paywalled; alternative source]. It is sending three variations of one letter, depending on the information it has about the recipient. “Taxpayers should take these letters very seriously. The IRS is expanding efforts involving virtual currency, including increased use of data analytics,” said IRS Commissioner Chuck Rettig. An IRS spokesman declined to say whether the letters stem from information turned over by digital-currency platform Coinbase. In mid-March of 2018, Coinbase provided data — under a federal court order — on about 13,000 accounts requested by the IRS.

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