The IRS has stated that recently they can track down people who are making a profit of Bitcoin without claiming it on their tax return.
The primary way the IRS "tracks" Bitcoin traders is through exchanges. If you give your passport and proof of residence to an exchange, your deposit/withdrawal and trading histories can be provided to regulators like IRS.
It became known a few months ago that the IRS is also working with Chainanalysis, which extensively works to link Bitcoin transactions/addresses to identities by scraping the internet and more specifically, darknet markets and forums. It's hard to know how much they know about us from watching our blockchain activity.
Bitcoin is anonymous only for the books but the reality is different. Everything can be tracked through the blockchain public ledger. So we can't call bitcoin truly anonymous.
Bitcoin privacy is terrible, but users can take steps to mitigate that. For instance, most people just use default sending rather than selecting UTXOs. Each output is tainted by its history. Keep that in mind before you send it anywhere, and certainly before you link a bunch of addresses together in a single transaction. Signing transactions from multiple addresses makes it easier to track your wallet because those addresses are forever linked together after that.