Overview
On June 26, 2023 Tax Notes quoted Caitlin Tharp in an article titled, “IRS Seeks Help with Digital Asset Noncompliance.” The article discusses the IRS’ search for digital asset pricing and tracking tools to assist with its compliance efforts.
Caitlin stated, “[T]he IRS is looking into digital assets because it knows there is such a large amount of income that is generated from digital asset transactions and a large amount of unreported income. This is really the IRS trying to catch up and get the data processing software, the tools so that they can capture what crypto digital asset transactions are occurring, and actually go after the taxpayers who aren't reporting that income.”
“The agency seems to have realized that if it doesn’t have precise data that is capturing the volatility — the price changes over the course of a day — it might be leaving money on the table by not having data that reflects the price at which the crypto was sold.” She continued by stating, “[T]he IRS is trying to figure out how to better track basis, one of the largest difficulties with tracking digital assets. The agency needs to determine when income is generated based on basis and compare that against what a taxpayer is reporting.”
The full article can be read on Tax Notes (subscription required).
