Fortunes Have Been Made From Cryptocurrency and the IRS Wants it’s Share

If you invested $1,000 in Bitcoin back 2010, your investment would be worth roughly $35 million today.

The IRS took notice that the number of tax returns showing gains from virtual currency were not in line with the number of investors. On November 29, 2017, the IRS ordered one of the largest websites for trading digital currency, Coinbase, to turn over identifying information for anyone who bought, sold or sent $20,000 or more to the IRS, including taxpayer ID number, name, date of birth, addresses, transaction logs and account statements. Initially, the IRS requested the records of every Coinbase account but a California federal judge found that “unnecessarily comprehensive”.

Coinbase has over 6 million users and fewer than 1,000 taxpayers reported gains on their returns. The decision will affect over 14,355 Coinbase account holders.