Barry G. Fowler, EA, leading expert in tax resolution issues and CEO of Taxation Solutions talks about the rising temptation by ordinary taxpayers to invest in and accept Cryptocurrency as payment and suggests transparency in declaring it as an income source when filing federal taxes.
Houston, TX – February 22, 2018 – Barry G. Fowler, CEO of Taxation Solutions, posted a new blog on the company website entitled “Don’t Let Cryptocurrency Crimp Your Relationship With The IRS.” Mr. Fowler doesn’t want any taxpayer to trigger red flags with the IRS as a result involvement with Cryptocurrency.
Fowler writes, “Cryptocurrencies such as Bitcoin are becoming more popular as a form of payment and as investment.” He continues, “However, there has been little attention paid to how this virtual currency will be treated by the IRS until now. In fact, the IRS is taking a much closer look and has established some tax guidelines.”
“According to an article published in accountingtoday.com,” says Fowler, “For federal tax purposes, virtual currency is treated as property and not currency.” They add, “The fair market value of the virtual currency on the date of receipt determines the taxpayer’s basis.”
“Some businesses are actually paying employee wages in virtual currency instead of U.S. dollars,” Fowler states, adding, “In these cases the currency must be reported on a W-2 and is taxed at the fair market value of the digital currency. Likewise, independent contractors who are paid with virtual currency are subject to income tax and self-employment taxes based on the fair market value.”
On another note of warning, Fowler states, “The IRS is being used as a lure in an attempt to validate Cryptocurrency Retirement Accounts.” He shares a recent warning published by cryptovest.com stating, “The U.S. Commodity Futures Trading Commission (CFTC) has warned investors to be cautious of any digital currency retirement accounts that claim to be “IRS approved” or “IRA approved”.
The entire blog can be read at http://www.taxationsolutions.net/dont-let-cryptocurrency-crimp-your-relationship-with-the-irs/
About Barry G. Fowler, EA
Barry G. Fowler founded Taxation Solutions out of a genuine concern for the IRS issues his clients face, many of whom are self-employed, contract employees, or entrepreneurs. For his contributions to his profession and expertise in tax resolution and financial planning, Fowler has been featured as one of America’s Trendsetters on CBS and Yahoo, and as a Premier Expert in Inc. Magazine. He has been instrumental in helping hundreds of people resolve complex tax issues with the IRS.
Fowler is licensed to represent taxpayers before the Internal Revenue Service, and is a longstanding member of several tax industry professional organizations: NAEA, NATP, TSEA, ASTPS.