It is no surprise that there are taxpayers that fumble into faults or mistakes in the filing of their tax returns. This is most evident when the person files it by him/her self who is alien to any accountancy mumbo jumbo.
Faults may be intentional or unintentional, frivolous or not, skipped or forgotten entry, lost or unrecouped documents. Whatever the reason might be, the Internal Revenue Service (IRS) will definitely not look the other way around.
Taxpayer faults and mistakes of unintentional manner or of frivolous reasons, the IRS usually sends out warnings then petty penalties for repeated offense then serious penalties for constantly repeated offenses.
But not for the graver wrongdoings on the IRS which the IRS determines after careful and detailed investigation from the start. Tax fraud and tax evasion. These merit not only the attention of the IRS but also of the other branches of the federal government.
The Department of Justice (DOJ) and the Securities and Exchange Commission (SEC) would take part in the investigation of such cases stemming from cryptocurrency culpabilities by a person or group of persons that represent a company or a group of companies.
Such cases in virtual currency tax fraud and tax evasion have been docketed for some time now and all differ in the resultant decision of the court. Some might be just a little above the stringent IRS penalties while others might be too unexpected that a common taxpayer will think twice.
This taxpayer fault comes in two faces: evade assessment or evade payment. The evasion of assessment would, in the natural course, happen first before the fault of evasion of payment. The first evasion, among the two, is the more common in the files of the IRS.
Failure to file a tax return is a form of evasion of assessment while exclusion and concealment of ownership of assets – such as yachts, real property, property including virtual currency – is an act considered as an evasion of payment.
The SEC, through the years, have prosecuted a number of cryptocurrency-related companies representing themselves as reliable and dependable assets for investments in the crypto world. Many were incarcerated but not as long as tax fraud.
This taxpayer fault, individual or a business entity, may be put under the shadow of tax of evasion, but it is far more than that. This is an event when a particular taxpayer knowingly and is willingly providing false information on their tax returns with regards to their cryptocurrency activities.
This would tick the ears of the DOJ and/or the SEC, depending on who the defendant is, and escalate the consequences of the crime to something that would definitely be regretful and unforgettable for the defendant since a lot of this crime extracts monetary remuneration and a decade or so in incarceration.
The consequences of what you think and do today will affect the path of your future. Don’t declare anything above what it is, or that which is not present. Turbo Tax will help you all the way in tax reporting, straight and clean.