Bitcoin Holders Can’t Escape the IRS

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Bitcoin is the currency that no government controls. But the government still collects taxes on it, and the Internal Revenue Service has just told taxpayers that it’s about to increase its scrutiny of their crypto gains. The news comes as Bitcoin has been in a relative slump, falling to $9,500 on Monday after briefly rising above $13,000 last month.

The IRS has begun sending letters to more than 10,000 taxpayers asking them to assert that they’ve paid all the taxes on their cryptocurrency gains, or to contact the IRS about making it right. In a release about the letters, the IRS warned that “[t]axpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest and penalties.”

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