3 ms·

In your opinion, does the IRS give leniency towards people who make their best effort by either hiring a tax person, paying for software or both? Cryptocurrenc

In your opinion, does the IRS give leniency towards people who make their best effort by either hiring a tax person, paying for software or both? Cryptocurrency taxes are insanely awful, even if you're not talking big money. Just trying to be accurate is near impossible if you've moved your money around exchanges a few times & spent some on goods. Unless you have lots of money in Crypto it seems like trying to do honest taxes on it costs more than any money you would have made over the past few years.

tldrthelaw 5y ago
IMO, not legal advice, the investigators are human beings. Good faith efforts to comply with the law will net you better results than avoidance. This is also reflected in the tax code which is replete with examples of higher fines for, say, undeclared income as against under-declared income.
mikestew 5y ago
As one who probably should hire an accountant more often than I do, I've underpaid the IRS a few times. Look, despite whatever image popular media might want to portray, the IRS just wants what's owed and not to anally violate you. You'll get a letter in the mail stating "here's how much you owed" (sidenote: then WTF didn't you tell me that to begin with? Could have saved both of us a lot of trouble.) You write the IRS a check, along with some extra for penalty, and you never hear from them again. My anecdata relate to stock trades, so kinda relevant to your question. Do the best you can (and really, hire an accountant), and it'll be fine. Now, if one is blatantly practicing quasi-legal "tax avoidance" then you're on your own. But my experience, as a person who did the best they could and still screwed it up, is that the IRS is not nearly the scary monster it is made out to be.
- tldrthelaw 5y ago
  Mostly agreed, with the exception that if you're construed to have been engaging in tax avoidance -- regardless of whether you are or not -- you'll just as soon be on your own.
  - adabyron 5y ago
    This has always been my biggest fear. I don't purposely do it, but I worry that a mistake I make could be seen as large enough of a hassle to where all other parties would say you're on your own to fix & figure this out. Which could then cost a large amount of my time plus fees, which then correlates to lost revenue.

tldrthelaw 5y ago

IMO, not legal advice, the investigators are human beings. Good faith efforts to comply with the law will net you better results than avoidance. This is also reflected in the tax code which is replete with examples of higher fines for, say, undeclared income as against under-declared income.

mikestew 5y ago

As one who probably should hire an accountant more often than I do, I've underpaid the IRS a few times. Look, despite whatever image popular media might want to portray, the IRS just wants what's owed and not to anally violate you. You'll get a letter in the mail stating "here's how much you owed" (sidenote: then WTF didn't you tell me that to begin with? Could have saved both of us a lot of trouble.) You write the IRS a check, along with some extra for penalty, and you never hear from them again. My anecdata relate to stock trades, so kinda relevant to your question. Do the best you can (and really, hire an accountant), and it'll be fine. Now, if one is blatantly practicing quasi-legal "tax avoidance" then you're on your own. But my experience, as a person who did the best they could and still screwed it up, is that the IRS is not nearly the scary monster it is made out to be.

tldrthelaw 5y ago
Mostly agreed, with the exception that if you're construed to have been engaging in tax avoidance -- regardless of whether you are or not -- you'll just as soon be on your own.
- adabyron 5y ago
  This has always been my biggest fear. I don't purposely do it, but I worry that a mistake I make could be seen as large enough of a hassle to where all other parties would say you're on your own to fix & figure this out. Which could then cost a large amount of my time plus fees, which then correlates to lost revenue.