According to an online survey of 305 US adults conducted by YouGov in collaboration with CoinLedger, 31% of bitcoin and crypto investors still need to report crypto assets on their tax filings.
The lack of crypto tax reporting compliance is attributed to several factors including a need to understand the tax implications of crypto transactions. The survey finds that just 38% of crypto investors correctly identified the types of taxable crypto transactions.
“It’s no secret that tax reporting is a big problem in the crypto industry. The level of non-compliance may be shocking to some, but it isn’t surprising given the lack of regulatory clarity and enforcement guardrails in the space.”David Kemmerer, CEO of CoinLedger
58% of respondents indicated that they report crypto on their tax filings, while 50% of non-taxpayers cited a lack of profit as their reason for not paying taxes on their crypto investments.
Furthermore, 68% of respondents indicated that they would find it easier to file their correct taxes if given more info and guidance on the exercise by cryptocurrency exchange platforms.
With crypto market participants like Binance, Cryptiony, and a few others now making efforts to create tools that simplify crypto tax reporting, coupled with the increased scrutiny by tax authorities such as the IRS as well as those across other jurisdictions, crypto tax evasion is expected to decrease significantly going forward.