Crypto transactions of at least US$10,000 would have to soon be reported to the Internal Revenue Service (IRS) as the US Treasury under the Biden administration is planning to improve tax enforcement.

“Cryptocurrency already presents a major detection issue by encouraging criminal activity in general, including tax evasion,” the Treasury Department said in a press release.

Crypto Transfers Over $10,000, IRS Should Be Reported

“As a result, the President’s budget provides new funding for the IRS to handle the rise of crypto assets,” the department continued. 

“Coins and crypto-asset trading accounts, as well as payment service accounts that accept cryptocurrencies, will be included under the current financial account reporting regime. 

Furthermore, businesses that receive crypto assets with a fair market value of more than $10,000 will be reported on, just like cash transactions.”

Bitcoin changed course shortly after the Treasury’s announcement and was last seen trading up 1.6 percent. Earlier in the session, it was up more than 9%.

Over the last month, an increasing number of Wall Street analysts have warned that regulators at the Treasury and the Securities and Exchange Commission may soon take a more active position in cryptocurrency regulation.

Bitcoin’s Price In The Last Three Months

USA’s Treasury Department’s statement was part of a larger announcement about the Biden administration’s attempts to combat tax avoidance and encourage stronger enforcement. Among the measures being considered by officials are increased IRS funding and technology, as well as harsher punishments for those who fail to meet their obligations.

According to Treasury figures, the discrepancy between taxes owed to the US government and those actually collected in 2019 totaled approximately $600 billion.

Following the IRS announcement, Bitcoin pared a regular gain, shaved around US$3,000 from the token’s price. As of 4:23 p.m. in New York, it was up 5.7% to US$40,530. 

Cryptocurrency-linked stocks such as Coinbase and MicroStrategy also lost some of their gains following the report, which sparked an uproar on Twitter from some digital-coin enthusiasts.