Charles S. Kolstad
The IRS is very focused on getting information about cryptocurrency investors, as their view is that there are a large number of such investors who are not complying with the current tax rules.
Charles, who notes that more people are investing in cryptocurrencies than ever before, comments that this change will cause a problem for many of these taxpayers: “The IRS is very focused on getting information about cryptocurrency investors, as their view is that there are a large number of such investors who are not complying with the current tax rules. The IRS has successfully subpoenaed several cryptocurrency exchanges such as Coinbase and Kraken to get information on clients with more than $20,000 in activity.”
Charles also acknowledges that the “IRS guidance does not address many of the tax issues that arise, such as whether the mark-to-market provisions of Section 475 apply to traders of cryptocurrencies, or whether non-fungible tokens — NFTs — are collectibles subject to the higher 28% capital gains tax rate.”
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