The Internal Revenue Service was aware of significant underreporting of cryptocurrency on tax returns and used one of its investigative tools (i.e., a John Doe summons) in 2016 to seek financial information on thousands of individuals, including James Harper. Harper sued in 2020, alleging unlawful access to his private financial information, and has been embroiled
A recent Tax Notes article highlighted the debate surrounding a Justice Department memo proposing the reassignment of Tax Division lawyers to U.S. attorneys’ offices across the country. Experts weighed in on the potential impact on tax enforcement, with some arguing that decentralization could weaken compliance efforts, while others saw opportunities for increased efficiency at the
Before the introduction of Bitcoin, around 2008, Wells Fargo included the phrase “Banking is necessary. Banks are not” in its 2004 annual report. The adoption of digital assets by traditional banks has been slow, primarily because of regulatory obstacles and a lack of legislative guidance that would help ease fears and reduce risks. Both
In 2024, the IRS ramped up its focus on partnerships, including several actions before President Trump took office. However, with a new Treasury Secretary Scott Bessent confirmed, new IRS Commissioner Billy Long named but not yet confirmed, federal funding cuts, a federal hiring freeze, and employee reductions at both IRS and the Department of Justice
Two recent criminal tax cases, one crypto focused and one less so, show how digital assets are making their way into the normal legal process involving criminal tax enforcement.
The United States Department of Justice announced, in April 2024, that Roger Keith Ver, known by his followers as “Bitcoin Jesus,” was indicted on fraud
The IRS published final regulations on information reporting obligations for certain DeFi participants and, on the same day, the Blockchain Association, Texas Blockchain Council, and DeFi Education Fund filed a lawsuit in the Northern District of Texas claiming violations of the Administrative Procedures Act and the U.S. Constitution.
My previous article provided a
Final regulations on informational reporting obligations for custodial brokers were published in the Federal Register on July 9, 2024 with an ominous note that the information reporting requirements for non-custodial brokers (i.e. Decentralized Finance or DeFi) would be forthcoming. The first effective date for those final regulations would be January 1, 2025. On December 27
An old German proverb states that “to change and to change for the better are two different things.” As 2024 ends, the legal and business communities who must navigate government scrutiny are seeing the signs of change in the regulatory landscape on the horizon. The pencils for redrawing the lines of government involvement in economic
In one of my favorite legal movies, A Few Good Men, the lack of evidence on a particular point is brought up when Demi Moore’s character says to Tom Cruise’s character that he knows that something is true. Tom Cruise’s character then exclaims “it doesn’t matter what I believe, it only matters what I can
Cryptocurrency has grown from a niche digital curiosity to a mainstream financial instrument. With the surge in popularity and the increase in transactions involving cryptocurrencies, the IRS has intensified its focus on ensuring proper tax reporting. They have also over-corrected with guidance and rules