Read a couple of tax court rulings, IRS embarrasses itself all the time on overzealous stretches. With non-reporting the IRS doesn't know how a taxpayer is cat

Read a couple of tax court rulings, IRS embarrasses itself all the time on overzealous stretches. With non-reporting the IRS doesn't know how a taxpayer is categorizing a transaction. They wouldn't know if a transfer was a payment for a good/service with a capital gain or less required, or if a transfer was collateralizing debt to a third party that manages their collateral however they want which would not be a tax event, for example.