There are only three days left for US citizens to file their taxes, and crypto holders are still nowhere to be found, according to data from Credit Karma.
Since the credit reporting agency last provided its statistics, the number of people who reported cryptocurrency gains on their tax returns for this year hasn’t changed.
Only 100 out of the most recent 250,000 filings on Credit Karma included their cryptocurrency gains.
“There’s a good chance that the perceived complexities of reporting cryptocurrency gains are pushing filers to wait until the very last minutes. I want to reassure people that it’s not as complex as it may seem at first glance and that Credit Karma Tax has a number of resources about how to approach Bitcoin and taxes,” said Jagjit Chawla, the company’s general manager.
The IRS, for what it’s worth, does not see Bitcoin as a currency or any form of tender, but rather as an asset whose value fluctuates. If the value trends upwards sufficiently, holders of such an asset are required to pay capital gains tax.
Anyone who held Bitcoin at the beginning of 2017 would be roughly 8 times richer today, and nearly 20 times richer at the end of the year.
Considering how the market inflated in value rather quickly, analysts are saying that the sum total of taxes owed by US households is somewhere in the ballpark of $25 billion.
Elizabeth Crouse, a partner at law firm K&L Gates, doesn’t agree with Chawla.
“If I had to guess, there’s probably a lot of underreporting. Most of the people in the cryptocurrency world tend to have a pretty high risk tolerance,” she said.
If Crouse is correct, the IRS is going to have a field day mustering up the resources to knock on everyone’s door.
Considering how close we are to the tax filing deadline, it would be rather optimistic to believe that all cryptocurrency holders will just pop in at the eleventh hour to file their taxes at the same time.