Received Two-Year Prison Sentence for Hiding Bitcoin Transactions to Avoid Paying Taxes - Coin Bulletin

A man living in Texas was sentenced to two years in prison for tax evasion by underreporting his $3.7 million in earnings from Bitcoin sales.

This case has gone down in history as the first tax evasion case conducted entirely through cryptocurrency in the United States.

According to the statement of the Ministry of Justice, Frank Richard Ahlgren III underreported or did not report at all the income he obtained from Bitcoin sales between 2017 and 2019 in his tax declarations.

According to the case file, Ahlgren conducted a total of 4 million dollars' worth of Bitcoin sales but tried to conceal these gains.

In 2017, Ahlgren, who sold 640 Bitcoins, used the proceeds from this sale to buy a house in Park City, Utah. However, he claimed to his accountant that he had purchased the Bitcoins at a higher cost than he actually did. In this way, he reduced the taxes he had to pay by showing lower profits.

Bitcoin transactions concealed

Ahlgren used multiple wallets to conceal Bitcoin sales and conducted some transactions face-to-face for cash. Additionally, in May 2014, he wrote blog posts about privacy tools called 'mixers' and used them to hide his earnings.

Stuart M. Goldberg from the Ministry of Justice stated that Ahlgren made millions of dollars but instead of paying taxes in accordance with the law, he complicated his transactions on the blockchain to conceal his earnings. Goldberg said, "This behavior has resulted in a two-year prison sentence for him today."