IRS anticipates more crypto-related tax crime as filing deadline looms

The U.S. Internal Revenue Service is expecting to see a lot more tax evasion crimes linked to cryptocurrencies this year, its criminal investigation chief Guy Ficco told CNBC at the Chainalysis Links event. 

The IRS investigation chief told CNBC on Saturday that he is noticing more “pure crypto tax crimes,” whereas previously, crypto’s illicit use was predominantly associated with larger frauds such as scams and embezzlements. 

“This could be purely not reporting income generated from crypto sales, it could be hiding the true basis of crypto,” said Ficco. 

The agency is expected to charge the crypto-related tax evasion more aggressively as it expects to see more cases this year and going forward, according to the IRS official.

For tracking crypto tax delinquents, the IRS is working with several partners, including blockchain analytics firm Chainalysis. “My IRS special agents are phenomenal at tracing and following money, but some of the tools and applications that are needed when we start investigating in the crypto world with obfuscation of true ownership,” said Ficco, adding that that’s where IRS utilizes the help from companies like Chainalysis.

The tax filing deadline for U.S. taxpayers is April 15.