Open 24 hrs / 7 Days A Week
Real Tax Attorneys For Real Tax Issues

Fast Action. Proven Results.


Bitcoins and offshore reporting requirements

Federal officials closely scrutinize reporting of cryptocurrency gains on tax returns. This is in large part due to difficulties determining whether cryptocurrency is property or currency.

Classifying bitcoins and cryptocurrency as property or currency has tax implications. In a foreign country, a U.S. citizen may not need to report property to the IRS. Currency is a different matter. If considered currency, this currency may require reporting on tax forms.

This became an issue due to language inserted into the Foreign Account Tax Compliance Act (FATCA). In 2014, the IRS issued a notice stating that cryptocurrency be considered property. However, FATCA requirements hold that foreign financial institutions report on all holdings in accounts. This includes cryptocurrency exchanges by U.S. taxpayers.

Michigan taxpayers with offshore holdings may wonder whether they need to report information concerning cryptocurrency exchanges. On the one hand, we have the IRS issuing a notice that appears to say one thing. Then we have FATCA language saying another.

The American Institute of Certified Public Accountants tried to provide some guidance. In a June 2016 letter, the institute concluded such reporting is necessary. They recommended that individual taxpayers summarize information regarding cryptocurrency accounts on Form 8938 (“Statement of Specified Foreign Financial Assets”).

As in most tax-related matters, nothing is simple. This is especially true when it comes to offshore accounts. Failure to adequately report offshore holdings and activities can result in severe civil and criminal penalties. For this reason, seeking the advice of experienced tax attorneys in such matters is generally a good idea. An attorney can look at your individual circumstances and help describe to you all of your options.

No Comments

Leave a comment
Comment Information

When you hire us, we can help: you:

  • Obtain emergency relief from IRS actions
  • Stop the IRS from garnishing your wages
  • Prevent levees from being placed on your bank accounts
  • Keep tax payments and penalties from spiraling out of control

Phone Answered 24/7

We are always available to answer your questions and put your mind at ease.

Call us today at
800-778-2741 for a free initial consultation

Competitive Pricing

We offer flat fees that fit your needs and your budget.

Read Our Pricing FAQ

What Past Clients Say About Us

I know I won't be getting those frightening letters anymore thanks to Chad Silver - such a weight off my mind!” - A. Gould, Ohio

Read More Testimonials

A Real History of Success

IRS debt of $682,437, Attorney Silver and his team negotiated the Debt down to zero.

View More Results

You Can Fight The IRS And Win. We Can Help.

No matter where you are in the process, we can help you make the best of your situation. Call us toll free at 800-778-2741 for a free case evaluation.

Get A Free Consultation »

Privacy Policy | Business Development Solutions by FindLaw, part of Thomson Reuters.

Back To Top