The IRS is going into full stalker mode as it plans to issue subpoenas, search through social media posts as well as interviewing families to ensure that people are paying taxes on their Bitcoin. Some of the top companies in the world will be subject to some of these investigations such as Google, Microsoft and Apple.
In a slideshow presentation with more than 180 slides, the IRS’ cyber crimes program manager, James Daniel explained the usage, ecosystem and technology behind some of the biggest cryptocurrencies such as Bitcoin, XRP and Ethereum.
Special agents for the IRS have been advised to conduct interviews, use electronic surveillance to determine whether a taxpayer transacts in or maintains a balance of Bitcoin, perform open-source examinations and more.
But that’s not all as the IRS will pull personally identifiable information and public addresses posted to social media like Twitter and Facebook.
Subpoenas have been suggested for information that is harder to get ahold of. This is where interviews will come into play for friends, family and even their bank teller.
“Such as those who know the financial habits of the Subject, including, but not limited to, bank tellers, family and friends of the Subject (if feasible), and establishments the subject frequents that may accept bitcoins.”
For bigger companies, this will include an audit of applications that have the potential to transact in cryptocurrency.
“However, one method that should be considered is serving Grand Jury Subpoenas to a variety of companies. Issuance of a Grand Jury Subpoena should be considered for Apple, Google, and Microsoft for the Subject’s complete application download history. Each application’s function should be explored to determine whether or not the application can transmit, or otherwise allow, transactions in bitcoin.”
On top of this, there are also instructions for using block explorers to find a linked address and obtain the time and amounts of transactions.
“Once a Bitcoin Address is identified, it can be looked up on a Bitcoin Block Chain Explorer to find information such as value, transaction times, transaction locations, which may help in corroborating information, identifying additional addresses, or assist in locating the subject.”