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The U.S. Treasury says that you should sell your crypto savings if you owe the IRS

June 17, 2020

The U.S. Treasury confirmed the IRS decision to deny a Maryland couple a payment plan. They require the couple to liquidate their $ 7 million cryptocurrency holdings to pay the tax debt.

The couple, Alexander and Laura Strashny were unable to pay their 2017 tax return. As a result, they owe the IRS unpaid taxes and penalties of $ 1.1 million. In July 2018, they asked the IRS to allow them to pay the debt for a six-year IP or payment plan.

Together with the IP application, they have enclosed a special form to demonstrate that they are eligible for the proposed system. In it, they mentioned that they earn over $ 200,000 in annual wages and withdraw $ 19,000 per month from their $ 7 million cryptocurrency account.

The U.S. Treasury says that you should sell your crypto savings if you owe the IRSThe U.S. Treasury says that you should sell your crypto savings if you owe the IRS

After checking the form The IRS decided that Strashnys could pay all of its tax liability and declined the six-year payment plan. The debtors have decided to contest the agency’s decision before the U.S. Tax Court.

Now, The financial court has confirmed that Strashnys has been unable to demonstrate why they were unable to withdraw additional amounts from their cryptocurrency account to pay the debt.

According to court records:

“The SO [oficial de liquidación] concluded that the petitioners had no intellectual property right after they found that they could fully discharge their tax liability by liquidating (or pledging) part of their cryptocurrency assets “

The IRS doesn’t forget cryptocurrencies

In May, crypto tax software company CryptoTrader.Tax shared details of a letter that it allegedly received from the IRS. According to the document, the tax authority appears to be asking external contractors to help calculate cryptocurrency user transactions.

The IRS has postponed this year’s tax payment due to the COVID 19 pandemic until July 15, but can extend it until October 15 if requested.. The agency classifies cryptocurrencies as real estate, meaning that every sale must bring a profit or loss that must be reported.