My Crypto Lawyer
As the cryptocurrency industry proliferates in the mainstream, demands for its enforcement by government agencies are growing, including the United States Internal Revenue Service (IRS), which has recently brought in two private-sector experts to assist in its efforts.
Specifically, the IRS has hired as executive advisors Sulolit ‘Raj’ Mukherjee, JD, a former Global Head of Tax at a private blockchain software technology firm, and Seth Wilks, CPA, who has worked extensively in the area of crypto asset tax policy, the agency said in a press release on February 27.
Bolstering crypto enforcement
Commenting on the development, IRS Commissioner Danny Werfel highlighted the complexity of the rapidly growing crypto sector, the importance of intensifying enforcement in this area for the sake of taxpayers and the country as a whole, as well as stressing the IRS’s activities to this end:
“This is a complex and evolving sector that has major tax administration implications. (…) It’s important we get this right for taxpayers and the nation. Pulling in expertise from the private sector to work with the IRS team is critical to successfully building the agency’s efforts involving digital assets and helping us do it in a way that works well for everyone.”
Furthermore, IRS Deputy Commissioner Doug O’Donnell explained that hiring these experts would help the agency “understand this sector while designing systems for reporting of cryptocurrency (…) and related transactions” and improve “employee capacity and access to tools in this rapidly evolving global landscape.”
IRS versus crypto
As a reminder, the IRS launched ‘Operation Hidden Treasure’ in 2022 as part of its crackdown on the individuals who do not report their crypto income on their tax returns, which the agency announced back in March 2021 at the Federal Bar Association, Finbold reported on June 16, 2022.
Indeed, to meet the operation’s goals, the IRS assembled a task force that included experts in discovering different types of digital asset income, in addition to combining the efforts of the agency’s civil and criminal departments of the Crypto Tax Fraud Enforcement.
Earlier, it had introduced a slight change to the crypto-related question in its income tax returns, asking whether the applicant had received, sold, exchanged, or otherwise disposed of any financial interest in any virtual currency during the reported year right before the tax filing season closed on April 18, 2022.
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