Here at Camuso CPA, we offer a wide array of tax services for investors including tax preparation and tax planning. Financial service and technology companies are transitioning from employee driven revenue models to information driven revenue models. Camuso CPA strives to deliver useful insights and offer relevant explanations about the latest tax and financial topics.
A cryptocurrency trader in Sweden has received a tax bill for almost $1 million. The case is one of a growing number of cryptocurrency-related cases being taken up by the Swedish Tax Agency, with several bitcoin traders receiving tax bills for millions of Swedish kronor since last year.
It is clear that tax enforcement related to unreported cryptocurrency tax liabilities from traders and investors is heating up globally with Sweden being no exception. In 2018 alone, the STA opened investigations into the activities of up to 400 Swedish crypto traders which is 10 times more than the previous year.
The cryptocurrency trader is currently disputing his tax bill claiming that for various reason it is unreasonable. This is due to the tax methodology and classification which the Swedish Tax Agency is applying to cryptocurrency transactions.
When the Swedish cryptocurrency trader included his cryptocurrency trades on the applicable tax form, he actually included a side note agreeing to corrections if his reports were wrong. This is not advisable and he would have been in a much better position contacting a professional experienced with cryptocurrency and the Swedish tax authorities to advise him before filing. He claims he got no response until 2018 when the tax agency audited him and decided to tax him at about 300 percent of the profit rather than 30 percent that he expected.
How US Investors Can Avoid This and Why They Need To Be Aware
Tax authorities across the world will continue to issue further guidance and focus more heavily on cryptocurrency tax compliance. We will continue to track these developments closely. Time will tell, but it will be interesting to see how things develop here in the states related to the designation of cryptocurrency as intangible property from the Private Letter Ruling in 2014.
This created a lot of confusion across cryptocurrency traders and a lot of misinformation spread about the proper way to report and track cryptocurrency transaction for tax purposes. Traders and investors who do not work with a CPA that is highly experienced in cryptocurrency taxation that is able to provide them accurate and proactive tax advice they may find themselves with an unexpected tax bill in the future, especially if they do not understand that every transaction is taxable.
Many investors cringe when thinking about taxes but working with an experienced cryptocurrency CPA can also lead to tax savings in addition to asset protection. We have saved our clients millions just this past year with proactive tax planning and advisement related to their cryptocurrency portfolios.
If you searching for CPA firms to assist you with reporting cryptocurrency income and capital gains, contact Camuso CPA. Whether you need tax preparation services, assistance with properly reporting gains and income from virtual currencies on your taxes, cryptocurrency portfolio analysis, or any other service provided by a certified accountant, Camuso CPA can help.