- The IRS has significantly increased the number of tax warning letters sent to U.S. crypto investors, signaling a renewed enforcement push targeting discrepancies in digital asset filings.
- Many letters appear linked to past users of exchanges like Poloniex, prompting tax experts to advise investors to review their filings and prepare for possible audits.
Crypto investors across the United States are feeling the heat as the Internal Revenue Service (IRS) steps up its enforcement efforts with a surge of tax compliance letters. Over the past two months, the IRS has reportedly sent hundreds of notices to individuals involved in digital asset transactions, raising alarms throughout the crypto community.
According to tax experts and reports from Fortune, the volume of these letters has grown significantly compared to last year. The agency appears to be zeroing in on discrepancies in crypto tax filings, signaling a more aggressive stance on digital asset enforcement.
CoinLedger, a popular crypto tax filing platform, revealed it received nearly 800 customer inquiries related to “IRS letters” between May and June 2025, early nine times more than the same period in 2024. Legal professionals are also feeling the pressure.
Jordan Bass, a crypto tax attorney, noted his firm has handled at least 10 such cases recently, a sharp rise from none the previous year. Andrew Gordon, another attorney, said he’s receiving several inquiries weekly from worried investors.
The current wave of IRS letters is reminiscent of earlier crackdowns in 2020 and 2021, when the agency sent compliance letters to individuals after gaining access to user data from major crypto exchanges, including Coinbase. That effort stemmed from a 2017 court order that forced Coinbase to hand over customer records.
This time, speculation is mounting around a possible link to Poloniex, a crypto exchange whose past users seem to be disproportionately affected. While the IRS has not confirmed obtaining new transaction data, the pattern of letter recipients suggests a connection.
Both Gordon and CoinLedger CEO David Kemmerer have noted that many individuals receiving letters had accounts on the platform.
The content of the IRS letters varies. Two versions are more advisory, encouraging recipients to review and verify their reported transactions, while a third is more assertive, demanding either amended tax returns or detailed explanations for existing filings.
Kemmerer remarked,
I’m sure there’s just people randomly getting selected, and the lucky ones get these scary letters,
adding that such outreach typically follows when the IRS gains new access to data.
U.S. taxpayers are legally required to report all taxable crypto transactions, including selling or swapping tokens, staking or mining rewards, and certain gifts. While investors can claim losses, failure to report gains can result in steep penalties.
As the IRS intensifies its scrutiny, experts advise crypto holders to double-check their filings and consider seeking legal or accounting advice if they receive a letter.
With digital assets now firmly on the taxman’s radar, crypto investors may need to brace for a new era of heightened regulatory attention.