U.S. Bitcoin Investor Sentenced for $4M Tax Evasion

A Bitcoin investor from Texas has become the first person charged with criminal tax evasion related to cryptocurrency transactions.

Frank Richard Ahlgren III is accused of underreporting his capital gains from Bitcoin sales totaling around $4 million.

Ahlgren, who had been investing in Bitcoin since 2011, allegedly sold approximately 640 BTC for $3.7 million between 2017 and 2019, but falsely inflated the cost basis on his tax returns, reducing his taxable capital gains. The U.S. Department of Justice (DOJ) uncovered discrepancies in his 2017 federal tax filing, leading to accusations of tax fraud.

In addition to the 2017 case, Ahlgren failed to report over $650,000 in Bitcoin sales between 2018 and 2019. The DOJ also found evidence that he used crypto mixers and other methods to conceal his transactions.

READ MORE:

Binance Unveils New Blockchain Project on Launchpool

Despite his efforts to anonymize his activity, he was eventually caught, with the government estimating his tax evasion to have cost over $1 million.

Ahlgren’s actions have now resulted in a two-year prison sentence, marking the first criminal tax prosecution solely involving cryptocurrency. On top of the prison time, he faces a $1.1 million fine and one year of supervised release.

This case highlights the growing scrutiny of crypto-related tax offenses and the IRS’s ability to track digital transactions.

Alexander Zdravkov

Alexander has been working in the crypto industry for three years, during which time he has established himself through his active participation in monitoring market dynamics and technological innovations. His interest in cryptocurrencies and new technologies is not just a professional commitment, but a deep personal passion. He follows the news in the sector daily, analyzes trends, and is excited about every new step in the development of blockchain solutions. His enthusiasm drives him to continuously learn and share knowledge, as he sees the future in digital finance and its role in global transformation.