- The IRS intends to subpoena large tech firms in order to determine the crypto usage of their users
- This is in a bid to combat tax evasion
- Social media and download history will also be searched
There are several implications for the increased use of cryptocurrency and one of these is the fact that regulatory bodies are forced to keep a closer eye on crypto usage and one of the ways this is done is by the implementation of crypto-related tax laws that have been on the increase in the last few years. While the IRS has been criticized in the past for not being quick enough to implement comprehensive crypto tax laws, it seems they have plans to monitor crypto usage by individuals more closely in the future and tech giants apparently will be aiding this effort. This was revealed via Twitter on July 9, 2019, when a presentation from the IRS was leaked.
The Taxman and the Tech Giant
The documents that were shared show that the IRS intends to use grand jury subpoenas on several tech firms such as Apple, Google, and Microsoft in order to get them to hand over information of the download history of their users for various crypto-related applications.
The presentation was allegedly for agents in the IRS criminal investigation division and according to Laura Walter, a crypto tax specialist who tweeted the document, the IRS is looking into the detection of criminal tax evasion cases that make use of cryptocurrency and in a bid to do this, they intend to carry out interviews, social media searches, and electronic surveillance and this is where the various tech giants will come in. The document stated:
“Grand Jury Subpoena should be considered for Apple, Google, and Microsoft for the Subject’s complete application download history. Each application’s function should be explored to determine whether or not the application can transmit, or otherwise allow, transactions in bitcoin.”
The IRS explicitly does not want users to know
The IRS also hopes that taxpayers will not be notified about the information being handed over to them so as to prevent any efforts to disrupt the investigation. Besides the tech firms that will be targeted in this effort, the IRS is also hoping to serve subpoenas to gain access to the information of accounts in both banks and payment platforms such as Paypal to investigate possible connections to crypto transactions. Social media platforms such as Facebook and Twitter will also be searched to find any publicly available information that links users to crypto addresses.