Despite the several months of warning to the individuals to pay their Cryptocurrency profits taxes, US-based investors don’t want to disclose to Uncle Sam what they owe. According to data from that tax services, only about 0.04% of the US taxpayers have declared and reported their Cryptocurrency based losses and gains to the Internal revenue service. This is few according to the 7% of Americans who own Bitcoin and other cryptocurrencies.
For the first 250,000 individuals who filed their tax returns by the use of Credit Karma, less than 100 of them disclosed taxable amounts from Cryptocurrency. Of those, only one disclosed crypto gain or loss big enough to be significant.
Although it’s early in the tax season- during the last count, IRS received 18.3 million individual tax returns. However, 13% others are expected during this tax season. The Cryptocurrency investors are reluctant to declare their earnings.
For instance, among the 2,000 Cryptocurrency owners Americans survey conducted by Karma Tax together with Qualtrics in January, only 57% of the respondents said they discovered gains in their investments. These are the profits which are considered taxable. However, 59% of Americans reported that they had none of the gains to IRS.
Even though the Credit Karma Tax prep service users are not US taxpayer’s representatives, they don’t have a significant part. For the first time Credit Karma offered their online services, one million people filed their returns through it. This makes it the fifth largest tax preparer.
When it comes to tax payments, Bitcoin investors are very evasive. IRS sued Coinbase, which is one of the leading Cryptocurrency exchange for accessing customer records after about 802 people made reports of losses or gains in Bitcoin in 2015. Therefore, Coinbase was ordered to identify around 14,000 customer accounts to IRS.
On the other hand, Bitcoin investors have always been pushing the crypto compatriots and giving them the warning to comply with IRS rules. Mike Novogratz warned people to pay their taxes. This is due to the fact that IRS was determined to go after people since they were making a lot of money.