IRS seeks millions of dollars in an attempt to regulate Cryptocurrency and stop Cybercrime

The decentralized nature of cryptocurrency has become a cause of concern for governments around the world. Steps are being taken to regulate the market. The most recent step is the Internal Revenue Services proposal to seek millions in funding to expand its oversight into cryptocurrency and cybercrime.

The latest Congressional Budget Justification & Annual Performance report specifies the money it requires to execute plans to regulate the sector. It also outlines how the IRS will acquire the support of outside contractors to execute the plans. The IRS is currently seeking a hefty sum of $13.2 billion for the 2022 fiscal year. It is a $1.2 billion increase from the last year.

Constituent of that fund is a sum of $32 million that will be used for building a special division to boost its crypto and cyber operations. The funds will allow IRS to build a dashboard for cryptocurrency and blockchain analytics and hire people to execute the operations. The internal, CI-owned dashboard will be called STRIKES.

Out of the $32 million, $23 million will be spent on contractor services. The agency quotes in the report, “Paired with extensive intelligence gathering, these contractors would supply proactive lead generation around tax compliance and illegal activities involving cryptocurrency. Additionally, these contractors would be strategically positioned within the ACDC facility to leverage training and subject matter expertise. The plan would be to expand the scope of work and reassess the return on investment each year to determine continuation.”

The Biden Administration has been trying to close the gap between crypto taxpayers and others and has proposed many tax changes to the same. The IRS seeks to propose regulations on information reporting on holding cryptocurrency beyond a certain amount of value. IRS reports, “Separately, reporting requirements would apply in cases in which taxpayers buy crypto-assets from one broker and then transfer the crypto assets to another broker, and businesses that receive crypto assets in transactions with a fair market value of more than $10,000 would have to report such transactions.”