Inside the IRS’s Expanding Surveillance of Crypto Investors

In brief

  • David Klasing, dual-certified tax attorney and CPA, says the IRS has moved from targeting “narrower groups” to broader crypto compliance investigations across multiple exchanges.
  • The Treasury Inspector General reports a 75% potential non-compliance rate among crypto users identified through exchange data, feeding the audit pipeline.
  • Nick Waytula, attorney and head of tax at Crypto Tax Calculator, warns the enforcement shift creates a “turning point,” moving crypto taxation from “opt-in” to “opt-out” model for millions of users.

The Internal Revenue Service has steadily widened its crypto surveillance capabilities since 2017, moving from narrow probes of individual traders to sweeping requests for user records at major exchanges…

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