The U.S. Internal Revenue Services (IRS) has previewed what crypto investors’ future tax form might look like when it finishes its much-debated rule on how cryptocurrency transactions should be reported to the federal government.
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Rodney Burton was arrested on Friday in Florida and will be transferred to Maryland.
Crypto Tax Proposal Open for Revision, IRS Officials’ Questions Suggest
While crypto representatives and lawyers cautioned the U.S. Internal Revenue Service (IRS) that its crypto tax proposal is a dangerous and improper overreach, questions posed by a panel of IRS and Department of the Treasury officials at a Monday hearing may reveal some flexibility in the rule as it’s still being written.
IRS ‘Raided’ by Crypto Investors as Industry Puts Up Fight Against U.S. Tax Proposal
The U.S. Internal Revenue Service (IRS) is gathering the final words now from a crypto sector that is arguing the agency’s proposal for a digital-assets taxation regime is an existential threat to investor privacy and to decentralized crypto projects.
Sweeping U.S. Tax Proposal Met With Boos From Crypto World
An immediate burst of criticism from the crypto industry shows the U.S. Treasury Department’s new proposal on how to handle digital assets taxes will face a long road as it enters a months-long period of public comments and hearings.
A Long-Awaited Crypto Tax Rule Was Written Months Ago. Why Isn’t it Proposed?
Crypto investors and their brokerages are waiting for a U.S. tax rule that will completely overhaul how they report their cryptocurrency taxes, but the government isn’t offering any straight answers about its holdup even as prominent lawmakers clamor for the Treasury Department to finish the job.
IRS: Crypto Staking Rewards Taxable Once Investor Gets Hands on Tokens
A cryptocurrency investor rewarded assets for validation activity on a proof-of-stake network should count the rewards as income in the year the investor gets control of those tokens, according to a ruling issued Monday by the Internal Revenue Service (IRS).
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IRS Called Cryptos And NFTs A Mountain Of Fraud
The IRS is hot on the trails of cryptocurrency and non-fungible tokens. They see these as fertile grounds for fraud, including tax evasion, market manipulation, and money laundering. Unfortunately, whether it’s a celebrity or not, people are always susceptible to getting into the trap.
The popularity of digital assets has created a new challenge for government agencies to regulate this modern-day currency. Regulators are working out how best to enforce existing laws and deter investors from engaging with criminal activity. But it will be an uphill battle without more resources or workforce.
The Los Angeles field office of the IRS’ criminal investigation division is on a task to pursue tax crimes and related financial matters. “We’re just seeing mountains,” said Ryan Korner, their special agent-in-charge.
Late Tuesday, at a virtual event, Korner said that celebrities are not immune to criminal probes from IRS. “We’re out there looking for anyone who makes openly or deliberately blatant statements requesting intervention on behalf of our agency,” he added, also referring specifically in this case towards an investigation into tax evasion, which may lead them to be more discreet about their finances in the future if found guilty.
IRS Crack Down on Crypto Financers
The IRS is cracking down on cryptocurrency financers. The investigative division of the agency seized $3.5 billion worth in assets during 2021, accounting for 93% of all financial crimes seizure by them that time frame, and they ended up with 80 cases still actively working where their primary violation was tied to cryptocurrency activity.
When law enforcement agencies see people paying millions for digital assets, like NFTs, without any inherent value, they can be curious. Korner says criminals could use these purchases as cover and launder money from criminal enterprises like drug trafficking.
Bitcoin price is still steady between $36K to $38K | Source: Tradingview.com
The rising concern among law enforcement officers is especially apparent with recent incidents where criminals have purloined vast sums from innocent victims using cryptocurrency transactions which allow them anonymity while transferring funds internationally.
The market is flooded with NFTs and crypto, making it easy for manipulation. High-profile investors have the power to sway prices with just one tweet.
Floyd Mayweather and DJ Khaled are no strangers when promoting social media campaigns. Still, this time the Federal Agency hit the two with Federal charges for failing to disclose their ties after running an advertising scheme in which certain companies paid them.
The Internal Revenue Service is investing in training all of its agents. So they will know how to deal with crypto and NFT affairs. Because “this space represents the future,” according to Korner.
The head of the agency says they’re working closely with other federal agencies, including the Justice Department. This way, everyone can stay ahead in their respective fields while ensuring they’re all working together seamlessly against criminals.
Featured image from Pixabay, chart from TradingView.com
Newly Discovered Monero (XMR) Glitch Will Negatively Affect Transaction’s Privacy
The developers of Monero (XMR) recently discovered a bug capable of exposing transactions of its users. Even though the team is working to fix it, they have announced that users’ privacy is at risk as long as the bug remains. The Monero team made this announcement through their official Twitter account.
They called it a “significant bug,” which they claim to have discovered in the crypto’s “decoy selection algorithm” This algorithm is a system that the network uses to hide output transactions within 10 decoys.
A Brief About The Bug History
The developer who discovered this bug was Justin Berman, a software developer. He noticed that the bug makes it easier for output transactions to become visible as real spend among the 10 decoys. Once the user spends money after a lock time in the first 2 blocks or spends money after receiving money, the transaction will be visible.
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When Justin discovered the bug, he stated that there is no risk of exposure for addresses and transaction amounts. However, it will enable users to know when a transaction occurs on the crypto. According to the developers’ statements, the bug won’t facilitate the stealing of funds, but it has remained in the wallet code.
Another Monero (XMR) contributor mentioned on Reddit that the Monero bug impacts past transactions. So, Monerao developers recommend that its users should wait for one hour or more after receiving XMR before spending it.
Monero (XMR) follows an uptrend on the daily chart as crypto market floats in the green zone | Source: XMRUSD on TradingView.com
That way, they can protect their privacy pending when there will be a wallet software update to reduce the privacy risks. Also, the developers assured the community that they don’t need to carry out a hard fork or full-scale network upgrade to tackle the bug.
Monero (XMR) Network
The Monero network joined the industry in 2014. It is a crypto that focuses more on the privacy of its users. Monero’s goal is to provide a system where crypto users can complete private transactions that no one can trace. The network uses unique cryptography to keep transactions 100% unlinkable and untrackable.
The crypto maintains a significant rank in the crypto industry based on its Market Cap and has been the largest amongst privacy-centered digital currencies. At press time, the XRM price stands at $263. This price represents a 4% gain in 24 hours of trading based on TradingView data.
Related Reading | Vitalik Buterin Urges Ethereum To Grow Beyond DApps
Before now, our sources have mentioned that many financial regulators’ eyes are on Monero. These agencies have done several things to break the privacy that characterizes their transactions.
For instance, in 2020, the Internal Revenue Service of the United States announced a $625,000 award for any person who can crack the transactions occurring on Monero and also on Bitcoin’s Lightning Network, another privacy-centric network.
Featured image from Business Insider, chart from TradingView.com
U.S. Treasury Calls For IRS Reporting Of $10K+ Crypto Transfers
Continued political buzz is abundant lately around crypto, and today is no exception. In a initial report from Bloomberg this morning, the U.S. Treasury has shared intent to require businesses, and likely individuals as well, that transfer $10,000 USD and above in crypto to report the transactions to the IRS. The move is part of a broader plan from the Biden administration to strengthen tax compliance.
The Treasury Talk
The information was sourced from a Treasury report titled ‘The American Families Plan Tax Compliance Agenda‘. “As with cash transactions, businesses that receive cryptoassets with a fair market value of more than USD 10,000 would also be reported on. Although cryptocurrency is a small share of current business transactions, such comprehensive reporting is necessary to minimize the incentives and opportunity to shift income out of the new information reporting regime”, the report stated.
Interestingly, the report specifically cited both cash and crypto as being viable shields from tax reporting; specifically, the report even describes crypto as posing a “significant detection problem by facilitating illegal activity broadly including tax evasion”. The report goes on to acknowledge that crypto transactions “are likely to rise in importance in the next decade”.
The report is likely to tie with IRS Form 8300, which requires individuals, companies, corporations, partnerships, trusts, estates and the like to report cash payments of over $10,000 USD.
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Continued investment in broader crypto has the federal government paying attention | Source: CRYPTOCAP - TOTAL on TradingView.com
Flurry Of Federal Chatter
The U.S. government has had increasing amounts of public-facing commentary. The Treasury’s commentary seems to ring a bit inconsistent from broader messages. Today’s report comes after two Federal Reserve policymakers stated earlier this week that cryptocurrency does not have a “reach into the economy that has systemic implications” for the Fed. St. Louis Federal Reserve President James Bullard and Atlanta Federal Reserve President Raphael Bostic both noted the volatility of crypto being a known trait, with Bostic adding that crypto was not “something I really incorporate very much into how I think about where our policy should be”.
The U.S. isn’t alone in the public discussion, either. Norway’s central bank has expressed concern that crypto’s volatility could be concerning for their banking system, and of course China’s potential rigid stance of crypto, with mining especially at the forefront, has consistently been a point of conversation in the space.
Of course, institutions have held a variety of views globally as well. Wells Fargo has warmed up to crypto investments, along with other major U.S. institutions, however the Bank of Canada recently stated that volatility in cryptocurrency assets is an emerging vulnerability for the country’s financial system.
Related Reading | Treasury Management Firm Says CFOs Avoid Risk, Bitcoin Won’t Become Corporate Vehicle
Featured image from Pixabay, Charts from TradingView.com
The IRS Just Issued Its First Cryptocurrency Tax Guidance in 5 Years
For the first time since 2014, the IRS is detailing how it will tax cryptocurrency holdings. Here’s what you need to know.
IRS Says It’s Sending Warning Letters to US Cryptocurrency Owners
The IRS has begun contacting U.S. taxpayers, warning them about possible back taxes owed on their crypto holdings.
