Crypto ATMs under scrutiny by US Internal Revenue Service
Cryptocurrency tax issues an emerging threat
Bitcoin ATMs are coming under increased scrutiny by the United States’ revenue service, due to the emerging threat of tax issues.
According to Bloomberg Law, criminal investigators at the Internal Revenue Service are looking for any illicit activity enabled by cryptocurrency – but they are “very” focused on tax issues, due to the lack of transparency and visibility.
“We haven’t had any public cases filed but we do have open cases in inventory related to cryptocurrency tax issues,” said IRS criminal investigation chief John Fort.
There are 4,135 bitcoin ATMs in the US, where users can trade fiat currency for crypto. Kiosks often take a cut of the cash by charging a flat fee to users.
“If you can walk in, put cash in and get bitcoin out, obviously we’re interested potentially in the person using the kiosk and what the source of the funds is,” Fort said.
Money laundering is another concern and the IRS is also looking at compliance issues relating to the ATM operators.
“They’re required to abide by the same know-your-customer, anti-money laundering regulations, and we believe some have varying levels of adherence to those regulations,” he said
As the IRA attempts to “tighten up” crypto trading in the US, Fort said they are aware this could push users to make exchanges abroad. “We have to focus on that as well,” he added.
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