The IRS is mailing 10,000 letters to crypto account owners. These letters attempt to educate crypto account holders about the rules and tell taxpayers to review their tax reporting for crypto transactions to be sure they reported income correctly. If necessary, taxpayers should file amended tax returns and or late returns. These tax returns should be marked with the corresponding letter type (i.e., Letter 6173, 6174 or 6174-A) and mailed to a particular IRS address. In other words, these tax filings won’t be a needle in the haystack and the IRS will take a close look. Many audits may follow.
Letter 6173-- is a severe tax notice, and you should not don’t dig yourself into a bigger hole with an incorrect reply. In some cases, perjury could be a felony. The letter states, “If we don’t hear from you by the “respond by” date we may refer your tax account for examination.”
Letter 6174-- is an “educational letter,” and it states, “you do not need to respond to this letter.” If you received this tax notice, then you should review your crypto tax reporting and consider filing an amended tax return, if appropriate. Consider the IRS advice a warning shot across your bow.
Letter 6174-A-- implies the taxpayer reported crypto transactions, but perhaps not in the proper way. For example, maybe the taxpayer used Schedule C (business income) instead of Form 8949 (capital gains). Perhaps they used like-kind exchanges, and the IRS might not allow that. Conversely, Letter 6173 indicates the taxpayer did not report crypto transactions at all.
Let us know if you receive one of these letters.We can help you navigate through the sea of unknown tax issues and poorly documented tax rules surrounding Cryptocurrencies.
TAX AND COST SAVING OPPORTUNITIES FOR BUSINESSES
The one constant in life is change. The new tax law is definitive evidence of that.
keeping with the theme of change, and making changes for better results, we are
excited to announce an expansion of our capacity to serve you and maximize your
tax savings and business profits.
to the development of new technology we now have access to Proprietary Business
Profit Enhancement Software that will analyze your company to match it with
additional savings available to you that go beyond traditional accounting and
Through these services we can find savings from Work Opportunity tax credits to R&D tax credits to commercial real estate taxes to credit card processing fees.
The use of this Proprietary Software is on a contingent fee basis. If we find any new savings for your company, the fee is based upon a percentage your savings.
invite you to take our Business Profit Enhancement Profiling Survey to
determine your increased profit potential. Call or email me today to make
arrangements to help you increase your bottom line.