IRS To Begin Surveillance of Bitcoin ATMs

IRS To Begin Surveillance of Bitcoin ATMs

The Chief of the Criminal Investigation Department of the United States Internal Revenue Service, John Fort mentioned, in an interview with Bloomberg Law which held on the 15th of November, that the agency has started monitoring possible taxing problems from Bitcoin ATMs and kiosks.

The executive told Bloomberg that the IRS is working together with law enforcement to scrutinize the unlawful use of cryptocurrencies. He stated that the agency was taking its time to monitor cryptocurrency transactions that may or may not be linked to bank accounts, and they were doing this to monitor what the source of funds might be. He said that the agency is also poised on monitoring kiosk operators likewise.

ATM Services Ramping Up
Based on a survey by Coin ATM Radar, there are currently 4,129 Bitcoin ATMs in the US which allows users to trade cryptocurrencies at a cost. It is believed that there is a Bitcoin ATM in all the key cities in the US. John added that the reason for this saturation is because operators of such services are expected to obey the know-your-customer, anti-money laundering laws.

It was reported some weeks back that Bitstop, a Bitcoin ATM company, had cited an ATM at the Miami International Airport, which suggests that cryptocurrencies are desired by users on the move.

Tax Conditions Still Unclear
John articulated that taxing cryptocurrency is starting to look like a threat, given that cryptocurrencies naturally lack transparency, making compliance by users a serious issue. Although he admitted that no case has been filed concerning this matter, he assured that the IRS had in its possession a good number of case files.

Some days back, an attorney in Associate Chief Counsel at the IRS office, remarked that cryptocurrencies do not qualify for like-kind tax immunity, even as far back as the 2017 tax revamping.

In the US, a ‘like-kind’ exchange is an asset transaction that doesn’t induce a tax liability from an asset sale. Even though crypto traders were alerted that post-revamping transactions are not privy to that kind of immunity, transaction qualification before that time was unclear.

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Author : Azeez Mustapha

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Azeez Mustapha is an experienced author, trader, markets analyst, signals strategist, and funds-manager.