How does tax evasion differ from tax avoidance when it comes to digital currencies?

1 answers

• Dec 17, 2021 · 3 years ago
  In the world of digital currencies, tax evasion and tax avoidance are two distinct concepts. Tax evasion refers to the illegal act of intentionally evading taxes by not reporting or underreporting income from cryptocurrency transactions. This can be done by using anonymous wallets, offshore accounts, or other means to hide income. Tax evasion is a serious offense and can result in criminal charges. Tax avoidance, on the other hand, involves using legal strategies to minimize tax liabilities. This can include taking advantage of tax deductions, credits, and exemptions that are available for cryptocurrency transactions. It is important to note that tax laws and regulations vary by jurisdiction, so it is essential to consult with a tax professional familiar with digital currencies to ensure compliance.
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