Updated: Feb 7, 2024 / 06:45 PM CST
FILE – An advertisement for the cryptocurrency Bitcoin displayed on a tram, May 12, 2021, in Hong Kong. U.S. regulators are soon expected to decide whether to approve the first bitcoin exchange-traded fund, a development that could thrust the once niche and nerdy corner of the internet even further into the financial mainstream. (AP Photo/Kin Cheung, File)
AUSTIN (KXAN) — An Austin man faces charges of tax fraud after allegedly buying a home with cryptocurrency profits that went unreported on taxes, according to a press release from the U.S. Department of Justice (DOJ).
The DOJ’s release alleges that Frank Richard Ahlgren III underreported the sale of $3.7 million in bitcoin in 2017 and failed to report $650,000 in sales on his 2018 and 2019 taxes.
The release claims that Ahlgren reported a higher price on his initial purchase of bitcoin, which would underreport his 2017 capital gains tax, the DOJ said. He then allegedly used the unreported profits to buy a house in 2017.
“All taxpayers are required to report any sale proceeds and gains or losses from the sale of cryptocurrency, such as bitcoin, on a tax return,” the release states.
Additionally, Ahlgren is also charged with multiple counts of “structuring” — allegedly depositing cash from sales in increments under $10,000 to avoid required currency transaction reporting.
When the criminal case goes to federal district court, Ahlgren faces the possibility of up to five years in prison per count of structuring and three years for each false return, according to the release.
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