According to key agency officials, the Internal Revenue Service (IRS) could crackdown on cryptocurrency valued in billions of dollars linked to illegal activities like tax fraud and other cybercrimes in the coming year.
During the 2021 fiscal year, the IRS cracked down and seized over $3.5 billion worth of cryptocurrencies. Roughly 93% of all assets seized were in crypto by the tax officials, as reported in the Internal Revenue Service criminal investigation annual report published on Thursday.
‘The trend of cryptocurrencies seizure will continue even in 2022,’ according to Jim Lee, IRS Chief of Criminal Investigation. The IRS has observed the use of crypto in many criminal activities as the year progresses.
Billions of dollars worth of Bitcoin as well as other digital currencies were seized by the Internal Revenue Service unit last year. The IRS also recovered $1 billion stolen from an online Bitcoin exchange which closed in 2013, called Silk Road. Microsoft Corp. software developer, a former employee, was also prosecuted for swindling the company’s $10 million by hiding it in cryptocurrency.
On Monday, President Joe Biden signed a law granting the IRS more ability to surveil infrastructure’s cryptocurrency transactions. This law makes it mandatory for the crypto broker to track and report transactions to the IRS by giving tax authorities more transparency into digital currency trades.
The Democrats propose an additional $80 billion of funds to the IRS in Biden’s Build Back Better plan. This bill could be voted on Thursday in the House. Lee said that his unit requires the fund to recruit 250 to 300 more special agents and track cybercrime in the system.