IRS is warning thousands of cryptocurrency holders to pay their taxes

If you own bitcoin or other cryptocurrencies, you might want to check your mailbox.

The Internal Revenue Service is in the process of sending letters to U.S. citizens who own virtual currency and potentially failed to pay the necessary taxes and to those who improperly reported taxes on digital assets last year, the agency announced Friday.

“Taxpayers should take these letters very seriously by reviewing their tax filings and when appropriate, amend past returns and pay back taxes, interest and penalties,” IRS Commissioner Chuck Rettig said in a news release. “The IRS is expanding our efforts involving virtual currency, including increased use of data analytics.”

The agency said it started sending out letters last week that by the end of August will reach 10,000 taxpayers. The list of names was obtained through “various ongoing IRS compliance efforts.” In some cases, the IRS said taxpayers could be subject to criminal prosecution.

Last year,…