Category: Cryptocurrency
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UFOs and government permits: an odd connection
For all our lives, there has been some background discussion of “UFOs”. It turns out that the simple fact is that at any given moment, there are thousands of “unidentified objects” data collection balloons in the sky above us. Some additional unidentified objects up there are apparently not balloons but something that some in our…
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Understanding cryptocurrency fraud
Cryptocurrency fraud falls into two main categories: Scams soliciting investment Theft of accounts The number of cryptocurrency scams is decreasing as people become more suspicious of unsolicited offers. This seems like a natural reaction to the publication of fraud risks. But the number of security breaches and account thefts is increasing sharply. Even sophisticated owners…
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The bitcoin conversation
Text message from Facebook friend: “Quick question: what are your thoughts on bitcoin? My sons keep telling me I need to get into. My accountant at present advises not. I only ask as I know you are a fountain of knowledge in the accounting world and just wanted to learn your opinion. Thanks!” Me: “What…
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CNBC published incorrect tax advice about reporting of cybercurrency
SHAME ON @CNBC editors and author @sahahtobrien! This type of inaccurate reporting of tax policy and procedure in this article should be called out for the misleading information portrayed as public advice. At best it is sloppy reporting. At worst it represents a lack of understanding of the topic covered and the spreading of incorrect…
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Update on new Bitcoin reporting requirement
This blog post uses “Bitcoin” in the title that actually could refer to all types of virtual currency. On December 23, 2020 the Financial Crimes Enforcement Network (“FinCEN”) issued a notice of proposed rules that would require money service businesses (“MSBs”) to keep records and submit reports that verify the identity of customers involved in…
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Forecast: Cryptocurrency ownership reporting will be required
This blog post is based on a presumption and projection of a proposed rule that may be modified delayed or cancelled. In other words this is a warning of ‘worst case’ impact on us based on the latest available information, Until now an owner of virtual currency had no obligation to disclose those holdings to…
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Does simply owning cyber currency put you at increased risk of audit and tax penalty?
Many cyber currency owners believe that if they didn’t receive any cash then there is no tax due now. IRS disagrees and will let them know! Even a “fork” in your cyser currency now triggers immediate tax under current IRS rules. Owing tax without receiving any real benefit strikes many as unfair and the Virtual…
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IRS just got serious about cryptocurrency
The just-released draft copy of Form 1040 Schedule 1 that starts off with the question: “At any time during 2019, did you receive, sell, send, exchange, or otherwise acquire any financial interest in any virtual currency?” I’m sure much discussion will follow about the potential consequences of answering with a false negative. Responding with an affirmative,…
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Concern over Tether
I’ve written a series of posts on the theme that investors have good reason for concern about cryptocurrency investments. The latest concern is Tether. Here’s what we know: Tether is the second largest cryptocurrency behind Bitcoin. Tether claims to be backed by US dollars, therefore eliminating market value fluctuation risk. Despite its massive market trading…
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Implications of blockchain in everyday accounting
The AICPA co-published a new report on blockchain that is written primarily by accountants at Deloitte & Touche LLP. The report covers a range of issues from introduction of concept to a call for action for CPAs. It is not an accounting standards publication but rather a white paper on the issue of blockchain. The decentralized…