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IRS expects to see record level of crypto loss claims this tax season

06 Dec, 2018
by David Borman
News
IRS expects to see record level of crypto loss claims this tax season

It's being reported by Bitcoin.com that this coming tax season will likely see more tarders than ever coming forward to report losses on their crypto investments. This of course could put some at risk who previously did not report their gains.

Basically traders face the conundrum of either reporting their losses, which means some tax relief but from now on they must be completely transparent with the IRS or risk penalties, or they could keep playing it close to the chest but then get no tax break.

Perry Woodin, co-founder of crypto tax reporting software developer Node40, is quoted in the article:

“It is clear that, with the huge falls in cryptocurrency markets during 2018, many people will be weighing up whether this is a good opportunity to reveal the losses they have suffered... Having not reported their crypto activity up to now though, those choosing to reveal losses this year will need to report their crypto positions every year from now on, giving the tax authorities much better visibility of people’s crypto involvement.”

Furthermore, traders who perhaps have hid gains from the IRS for many years could come under the microscope as well if they finally decide to repport now that they are losing.

Each trader will have to decide for themself how they want to procede, but anybody making considerable money trading will likely have to face the scruitiny of the IRS eventually. Might as well start in a year with heavy losses!

Read more: Crypto investors may owe the IRS as much as $25 billion

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