Many crypto investors haven’t been paying their taxes correctly — and the Internal Revenue Service may soon know about it.

Determining tax on transactions involving digital assets is a notoriously difficult exercise, often much more so than for traditional financial assets like stocks and bonds, according to accountants.

By one estimate, just 32% to 56% of U.S. taxpayers with crypto holdings report their transactions to the federal government, according to a research paper published in March by the Review of Accounting Studies, an academic journal.

“[Data] suggests a significant portion of taxpayers may be out of compliance,” Erin…