CONTACT US

For any general inquiries, please fill in the following contact form:

Our websites never use cookies or other technologies such as pixel tags and web beacons. We only retain personal information when the contact section of our websites is filled. To proceed and get in touch with us through this format please read our Terms & Conditions, updated to be in line with the provisions of the GDPR, and tick this box to consent in us retaining the above information for contacting purposes only.

SUBMIT

IRS Requests Bitcoin Buyer Records in Broad Tax Evasion Case

IRS Requests Bitcoin Buyer Records in Broad Tax Evasion Case

By

Agency wants identities of all U.S. traders from Coinbase exchange.

As first reported by Motherboard, the Internal Revenue Service is seeking the personal data of all U.S. Coinbase users who transacted between 2013 and 2015. In a statement, a Coinbase spokesman said the exchange site was “very concerned with the indiscriminate breadth of the government’s request.”

The subjects of the data request are identified in court documents simply as an indeterminate number of “John Does.” The IRS filing further states that “There is a reasonable basis for believing that such group or class of persons may fail, or may have failed, to comply with one or more provisions of the internal revenue laws.

In other words, the IRS believes that buying Bitcoin is probable cause for making an individual the subject of a tax evasion investigation.

Get Data SheetFortune’s technology newsletter.

Coinbase was the first fully licensed U.S.-based Bitcoin exchange, opening in January of 2015. It is now one of the largest Bitcoin exchanges handling dollar-bitcoin trades, though it still relatively small compared to exchanges catering to the massive Chinese cryptocurrency market.

The legal and tax status of Bitcoin has been a question mark since nearly its inception. One major early uncertainty was whether Bitcoin would be treated as a currency or as property for tax purposes. Many Bitcoin supporters argued that it should be treated as a currency, potentially simplifying their tax situation.

But in 2014, the IRS declared virtual currency would be taxed as property, and affirmed standard reporting requirements for any payments made with it.

But many of the early adopters of Bitcoin, including many who made small fortunes from the currency’s rise, were hardline techno-libertarians, and not terribly likely to submit voluntarily to such requirements. The IRS request to Coinbase indicates that Bitcoin will be brought increasingly into the light of the U.S. tax system, like it or not.

Coinbase says its lawyers are still considering a response. Bitcoin, now valued at $725 per coin, has nearly doubled in value since January.

(Disclosure: The author had a Coinbase account and received small Bitcoin payments in connection with writing and research about Bitcoin in 2014.)

http://fortune.com/2016/11/20/irs-bitcoin-tax-evasion-case/

MORE NEWS

British stockbroker at centre of £940m money-laundering investigation allegedly involving ...

British stockbroker at centre of £940m money-laundering investigation allegedly involving Venezuela's president
A British stockbroking firm is embroiled in a $1.2billion (£940million) Venezuelan money-laundering scandal. Fake investment schemes and a ...

Macron scraps fuel tax rise in face of gilets jaunes protests

Macron scraps fuel tax rise in face of gilets jaunes protests
French government drops measure from budget after weeks of protests that left parts of Paris in flames.The French government has bowed ...

Panama Papers: Four charged in US with fraud and tax evasion

Panama Papers: Four charged in US with fraud and tax evasion
Four men have been charged in the US with fraud and tax evasion in connection with investigations prompted by the leaked Panama Papers. ...

Who's behind the blog

Who's behind the blog

SOCIAL MEDIA