Don’t think that just because the currency is virtual, that the tax man doesn’t know you have it. Bitcoin and other virtual currencies are squarely in the crosshairs of the IRS and other agencies. The combination for potential for tax evasion, money laundering and illegal payments is just too enticing for the government to ignore.
For those who are using Bitcoin and other virtual currencies…beware. The taxman cometh…
The same agent that worked the Silk Road takedown is on the case for those looking to evade taxes using Bitcoin and other virtual currencies. Proper reporting and accountability of the gains and losses from trading is important – and if you gave control of overseas funds, you may have foreign asset reporting to the IRS required as well.
Make sure you are treating your virtual currencies properly for tax purposes. The IRS is focusing on them more today than ever before.