The Criminal Investigation (CI) Unit of the United Internal Revenue Service (IRS) has noted a surge in investigations related to the reporting of digital assets.
In its annual report released on December 4, the IRS investigative arm disclosed that it had launched over 2,676 cases, uncovering more than $37 billion linked to tax and financial crimes in the fiscal year 2023.
The CI Unit highlighted an increasing trend in the use of digital assets, leading to a rise in tax-related investigations.
The investigations mainly focus on unreported income stemming from the failure to disclose capital gains from cryptocurrency sales, earnings from cryptocurrency mining, or income received in the form of digital currencies, such as wages, rental income, and gambling winnings.
The CI Unit also pointed out instances of payment evasion, where taxpayers try to conceal their ownership of cryptocurrency to avoid disclosing their holdings.