The virtual currency market has appreciated significantly, causing investors to buy virtual currency for investment purposes. It operates like real coin or paper money of any country in the world, but it does not have the legal tender status in any jurisdiction. Bitcoin is the most popular example of a convertible virtual currency that can be digitally traded and used to purchase property or exchanged into US dollars, Euros, or other currency.
The IRS is also investigating taxpayers' compliance with information reporting requirements such as third-party settlement organizations and backup withholding. We are very familiar with these reporting requirements and the penalties associated with these failures to comply.
The types of cryptocurrency issues the lawyers at The Wilson Firm handle include, but are not limited to:
Filing both new and amended tax returns that properly report capital gains from the sale or transfer of cryptocurrency (including virtual currency used to pay for goods and services)
Money saving strategies for crypto day traders
Assisting companies in complying with employment tax rules, such as withholding requirements on wages paid with virtual currency
Audits and litigation related to virtual currency tax issues