NFT Trader Faces Up to Six Years in Prison for Tax Evasion of Nearly $13 Million

A U.S. citizen has admitted guilt in two instances of filing false tax information, which resulted in the concealment of approximately $13 million in profits from transactions involving CryptoPunks NFTs. This was reported in a press release by the U.S. Attorney’s Office for the Middle District of Pennsylvania.

According to authorities, Waylon Wilcox submitted inaccurate data in his tax returns for the years 2021 and 2022. During this timeframe, he profited from the sale of 97 tokens but responded «no» to a question regarding transactions involving digital currencies and failed to report his earnings on his tax documents.

As a result of this false reporting, Wilcox did not pay around $3.2 million in owed taxes.

«When a taxpayer sells NFTs, including CryptoPunks tokens, they are required to report any gains or losses from those sales in their tax returns,» the prosecution emphasized.

Under federal laws, the maximum penalty could involve up to six years in prison, probation, and fines.

Additionally, it is worth noting that on April 10, a collector sold a rare CryptoPunks token at a loss of $10 million.