The IRS began a heavy push to target Bitcoin and other cryptocurrency investors in 2019, and it has recently made clear that it will be continuing this push in 2021. After sending several rounds of “warning letters” to cryptocurrency investors over the past two years, the IRS will be shifting its focus to enforcement going forward.

Earlier this year, we discussed the Internal Revenue Service’s (IRS) plans to create a new Fraud Enforcement Office. The IRS announced the initiative on March 5, just as the effects of the COVID-19 pandemic were beginning to be felt across much of the United States.

As 2020’s revised Tax Day inches closer, many individuals and businesses are beginning the process of gathering the information needed in order to prepare their returns. For many, this includes information about their cryptocurrency investments. After issuing updated guidance (and warning letters) last year, the Internal Revenue Service (IRS) is preparing to hold taxpayers accountable if they fail to properly report cryptocurrency transactions on their July 15, 2020 returns.