#MoneyMonday #Operationhiddentreasure #IRS #Canthide
In an estimated three weeks from now or more specifically October 15, 2022 it will be the deadline for those who have not filed their 2021 tax return or have filed an April 15, 2021 tax exten-sion to file their return. For those who have already filed their return on time, you may think this Money Monday may not contain any information for you, but I suggest you keep reading. While we know that the Internal Revenue Service (IRS) may retain information about an individual, in the age of digital and cryptocurrency what you can hide is impossible.
In the year 2021, the IRS launched “Operation Hidden Treasure.” As the name suggests, the agency is seeking information taxpayers have not reported on their tax returns. In this case, they are specifically looking for unreported digital or cryptocurrency transactions information. Reportedly, this operation is a joint partnership between the civil division and the criminal division of the IRS.
There are three letters you do not want to receive from the IRS with regards to this operation. They are letters numbered 6173, 6174 or 6174-A. Interestingly enough, the letters contain a heading section – “Why We’re Writing You.”
Below that heading, is this following paragraph: “ We have information that you have or had one or more accounts containing virtual currency, and my not have met your U.S. tax filing and reporting requirements for transactions involving virtual currency, which include crypto and non crypto virtual currencies.” How would you like to receive one of those letters? I won’t tell you the rest of what they letters contain, but I’m sure you can guess, it’s not good news.
If you received a letter numbered 6173 from the IRS, it’s pretty much guaranteed that you are in serious trouble with the them, and the best thing you can do for yourself is seek professional help. This would not be the time for a do it yourself project. Here’s why:
By the time this letter is issued, the IRS knows you have crypto currency and or have engaged in virtual currency transactions. Secondly, you have not reported virtual currency information on your tax return. You should know by now, that the IRS, has required taxpayers to answer digital currency questions, and these questions appear conspicuously on the first page of IRS Form 1040. This was done intentionally, as part of Operation Hidden Treasure.
The final point I would share about letter 6173 is that it should not be ignored. As you prepare to file your 2021 tax returns for late filers or even it you have filed on time, but omitted your virtual currency transactions, take steps to correct them before your circumstances change.
That’s What’s UP!
Let’s talk about student financial aid assistance. The Application for Federal Student Aid for the 2023–24 school year should be available on October 1st, 2022 . While you have until June 30, 2024 to submit your application for student aid, states and schools award money on a first-come, first-served basis or impose deadlines earlier than the federal one. Prepare to apply on October 1st. And that’s what’s up!