News & Events

On July 26, 2019, the Internal Revenue Service (IRS) announced that it was sending “educational letters” to U.S. taxpayers who were potentially behind on their federal taxes as a result of underreporting or underpaying their cryptocurrency-related liability. On August 14, 2020, the IRS did it again.

While the Internal Revenue Service (IRS) extended Tax Day to July 15 and offered various other forms of relief to taxpayers in response to the COVID-19 pandemic, the nation’s tax collector is still vigorously enforcing taxpayers’ legal obligations. One of its primary means for doing so is by conducting audits, and many New Jersey residents and businesses can expect to face audits of their 2020 income tax returns.

As 2020’s revised Tax Day approaches, New Jersey taxpayers who bought, sold or used cryptocurrency in 2019 are likely to find that complying with their income reporting and tax payment obligations presents a challenge. Even though the Internal Revenue Service (IRS) has acknowledged that its guidance on cryptocurrency reporting has been less than clear, it has also clearly signaled its intent to target individual and corporate taxpayers that fail to accurately report and pay what they owe.

The IRS’s recently announced the formation of a new Fraud Enforcement Office housed within its Small Business/Self Employed Division. This new office will be specifically targeting tax fraud perpetrated by small businesses, and the Small Business/Self Employed Division’s Commissioner has stated that the Division will be enhancing its fraud enforcement efforts in 2020.

The Internal Revenue Service (IRS) has extended the federal income tax deadline for all taxpayers from April 15 to July 15. This applies to filings and payment, and it is an automatic extension so taxpayers do not have to file anything on April 15.