Last year, reports emerged that very few Americans were filing taxes on their cryptocurrency gains and losses.
It’s that time of year again. Taxpayers are earnestly searching for receipts and hunting down W2s; companies are pressing their financial departments for write-offs, and accountants are pulling all-nighters left and write. After all, there are only two things that everyone has to face: the first is death, and the second is taxes (unless you’re Jeff Bezos).
Cryptocurrency holders cannot escape death (we don’t think). But according to data published last year, a number of them have actually managed to avoid paying taxes. Indeed, fewer than 100 of the 250,000 users of Credit Karma’s tax preparation software last year reported any data on cryptocurrency gains or losses.
Other tax preparation services have reported similar figures, and Coinbase was even subpoenaed for customer data in 2017 after it seemed that an extremely low percentage of its user base was reporting crypto gains or losses to the IRS.
Why is this happening? And will things be any different this year?