Beautiful Virgin Islands

Tuesday, Jun 24, 2025

Crypto traders are facing a tax crackdown by the US Treasury

Crypto traders are facing a tax crackdown by the US Treasury

A new report could have major implications for US crypto users as authorities seek to modernise outdated tax infrastructure.

Cryptocurrency traders in the United States could face more stringent tax reporting requirements under proposals put forward in a new report from the US Treasury.

The report said cryptocurrencies were a "significant concern," saying they presented a significant obstacle for tax authorities by helping to facilitate illegal tax evasion.

The proposals would also see government investment in America's tax office, the Internal Revenue Service (IRS), funding it by an additional $80 billion (€65.5 billion) over the next decade.

The moves are part of a plan to close the "tax gap" – the difference between taxes owed and taxes paid – which could rise to around $7 trillion (€5.7 trillion) over the course of the decade, the report said.

Also falling into the tax authorities' crosshairs are wealthier Americans who tend to make more of their money from assets.

"While roughly 99 per cent of taxes due on wages are paid to the Internal Revenue Service (IRS), compliance on less visible sources of income is estimated to be just 45 per cent," the report said.

Crypto under scrutiny


Among the proposed changes, businesses that receive "cryptoassets" worth more than $10,000 (€8,176) would have to report them to the IRS, bringing cryptocurrency into line with current rules on cash receipts.

Another policy change would require payment services providers to file Form 1099 reports in order to discourage their clients from attempting to hide their income by using alternatives to traditional banks.

"Although cryptocurrency is a small share of current business transactions, such comprehensive reporting is necessary to minimise the incentives and opportunity to shift income out of the new information reporting regime," the report said.

One major stumbling block for US tax authorities is the outdated technology in use by the IRS, which has held back the agency's ability to tax income held in assets like crypto.

According to the report, the IRS's main tax processing system, responsible for processing over 150 million annual tax returns that account for $1.2 trillion (€981 billion) in revenue, is written in programming languages that date back over half a century.

The combination of outdated tech and the growth of alternative finance has disproportionately benefited America's top earners, "who can avoid taxes through sophisticated strategies such as offshoring, creating complex partnership structures, or moving taxable assets into the crypto economy," the report said.

SEC backs tougher regulation


Also on Wednesday, US Securities and Exchange Commission (SEC) Chair Gary Gensler indicated he would also like to see cryptocurrency trading come under tougher regulation.

"This is a quite volatile, one might say highly volatile, asset class, and the investing public would benefit from more investor protection on the crypto exchanges," Gensler said in remarks at the Financial Industry Regulatory Authority (FINRA)’s annual conference.

"Technology is always evolving, as are our markets. As we continue to stay abreast of those developments, the SEC and FINRA should be ready to bring cases involving issues such as crypto, cyber, and fintech," he said.

Speaking to Bloomberg on Wednesday, European Central Bank Vice President Luis de Guindos said cryptocurrencies had "very weak fundamentals" and that investors should be prepared for more violent swings like Wednesday's crash.

"When you have difficulties to find out what are the real fundamentals of an investment, then what you’re doing is not a real investment," de Guindos said.

Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
Germany and Italy Under Pressure to Repatriate $245bn of Gold from US Vaults
Airlines Evaluate Flight Cancellations Amid Escalating US-Iran Tensions
Starmer Invites Innovators to Join Government Talent Scheme
UK Economy’s Strong Opening Quarter Shows Signs of Cooling
Harrods Seeks Court Order to Secure Al Fayed Estate for Victims
BA and Singapore Airlines Cancel Dubai Flights Amid Middle East Tensions
Trump Faces Backlash from MAGA Base Over Iran Strikes
Meta Bets $14 B on Alexandr Wang to Drive AI Ambitions
WATCH: Israeli forces show the aftermath of a massive airstrike at Iran's Isfahan nuclear site
FedEx Founder Fred Smith, ‘Heart and Soul’ of the Company, Dies at 80
Chinese Factories Shift Away from U.S. Amid Trump‑Era Tariffs
Pimco Seizes Opportunity in Japan’s Dislocated Bond Market
Labubu Doll Drives Pop Mart to Status as China’s Most Valuable Toy Maker
Global Coal Demand Defies Paris Accord Goals
We have new information and breaking details to share about what is shaping up to be a historic air campaign tonight
Six Massive Bombs Dropped on Fordow; Trump: 'A Historic Moment for the U.S., Israel, and the World'
Fordow: Deeply Buried Iranian Enrichment Site in U.S.–Israel Crosshairs
United States Conducts Precision Strikes on Iran’s Nuclear Sites
US strikes Iran nuclear sites, Trump says
Pakistan to nominate Trump for Nobel Peace Prize.
BBC Demands Perplexity AI Immediately Stop Using Its Content
Telegram Founder: I Will Leave My Fortune to Over 100 of My Children
Political Turmoil Resurfaces in Belgium Amid Economic Concerns
Fed policymakers divided on timing of interest rate cuts
Trump signals imminent agreement with Harvard University
Inheritance tax referendum alarms Swiss billionaire community
Japan cancels bilateral security meeting amid US defence demands
AI skeptic Emily Bender warns that ‘the emperor has no clothes’
Israel Confirms Assassination of Quds Force Commander in Tehran
16 Billion Login Credentials Leaked in Unprecedented Cybersecurity Breach
Senate hearing on who was 'really running' Biden White House kicks off
Iranian Military Officers Reportedly Seek Contact with Reza Pahlavi, Signal Intent to Defect
FBI and Senate Investigate Allegations of Chinese Plot to Influence the 2020 Election in Biden’s Favor Using Fake U.S. Driver’s Licenses
Vietnam Emerges as Luxury Yacht Destination for Ultra‑Rich
Plans to Sell Dutch Embassy in Bangkok Face Local Opposition
China's Iranian Oil Imports Face Disruption Amid Escalating Middle East Tensions
Trump's $5 Million 'Trump Card' Visa Program Draws Nearly 70,000 Applicants
DGCA Finds No Major Safety Concerns in Air India's Boeing 787 Fleet
Airlines Reroute Flights Amid Expanding Middle East Conflict Zones
Elon Musk's xAI Seeks $9.3 Billion in Funding Amid AI Expansion
Trump Demands Iran's Unconditional Surrender Amid Escalating Conflict
Israeli Airstrike Targets Iranian State TV in Central Tehran
President Trump is leaving the G7 summit early and has ordered the National Security Council to the Situation Room
Taiwan Imposes Export Ban on Chips to Huawei and SMIC
Israel has just announced plans to strike Tehran again, and in response, Trump has urged people to evacuate
Netanyahu Signals Potential Regime Change in Iran
Juncker Criticizes EU Inaction on Trump Tariffs
EU Proposes Ban on New Russian Gas Contracts
Analysts Warn Iran May Resort to Unconventional Warfare
Iranian Regime Faces Existential Threat Amid Conflict
×