Bitcoin Investor from 2015 Admits to Falsely Reporting Crypto Profits
An individual who invested in Bitcoin early on has admitted to submitting tax returns that understated the profits he made from selling millions of dollars’ worth of Bitcoin (BTC).
As per the U.S. Department of Justice (DOJ), Frank Richard Ahlgren III purchased around 1,366 BTC in 2015 when the primary cryptocurrency was priced at less than $500. Two years later, he sold 640 BTC for $5,807.53 each, totaling $3.7 million, with the majority of the BTC sold originating from his 2015 acquisition.
Proceeds from the sale were used by Ahlgren to buy a residence in Park City, Utah. He then filed a false 2017 tax return with the Internal Revenue Service (IRS), inflating the cost basis of his Bitcoin purchases to underreport the capital gains from the sale.
In 2018 and 2019, Ahlgren sold over $650,000 worth of Bitcoin but did not disclose these sales on his tax returns for those years. U.S. taxpayers are mandated to report gains or losses from cryptocurrency asset sales on their IRS tax returns. The DOJ states that Ahlgren’s deceptive filings led to the IRS incurring over $550,000 in tax losses.
Ahlgren is awaiting sentencing, facing a potential three-year prison term, supervised release, restitution, and financial penalties.
