The IRS to be Trained on Bitcoin Currency

Monday, December 7, 2015

What is Bitcoin? Have you heard of the new, innovative virtual currency that has been created in the digital world? The interesting thing about this new electronic currency is that nobody, no individual, no government, controls it.  There is no actual physical money that represents Bitcoin either. Instead, Bitcoin is produced by the public and you can’t exchange it at a bank, you can’t pull it out of an ATM machine. What makes this a fascinating currency is that people and businesses are increasingly using this to purchase goods and services.

We are the Strategic Tax Lawyers and we wanted to let you know more about what the U.S. Treasury defines as a decentralized currency.  As such, the Internal Revenue Service (IRS) needs to be aware of Bitcoin and its technology, so training programs have been developed for tax examiners. The IRS is concerned about what this new currency means for tax purposes.  The IRS has developed an all-encompassing training program for IRS staff and tax examiners with other agencies supporting and contributing to assist with IRS learning about the virtual currency space. The Financial Crimes Enforcement Network (FinCEN) of the Department of Treasury usually works to fight tax crimes such as money laundering.  Now the focus is working closely with Internal Revenue Service to provide the latest and most advanced information for federal tax examiners.

As part of the educational development and training, these organizations will continue to examine digital currencies to determine if the currency exchangers and administrators are compliant with all the rules.  In the past, FinCEN's has provided tax enforcement and protection, but its current role to prevent violation of federal law is not as clear.  If FinCEN identifies serious problems, they will use their enforcement authority in order to penalize those who are not following the standards and are being non-compliant.

The Strategic Tax Lawyers, LLP are a firm of an IRS Bank Levy Attorney, a Payroll Tax Lawyer, and an IRS bank levy attorney.  We, at the Strategic Tax Lawyers Firm, are experts in tax code with years of experience dealing with the IRS.  Call the Strategic Tax Lawyers at (800) 669-4775 for a free consultation to assist you with your tax-related matters.