Court Authorizes IRS to Summon User Records From Kraken Cryptocurrency Exchange
The Internal Revenue Service (IRS) has obtained court authorization to serve a John Doe summons on cryptocurrency exchange Kraken. The tax agency is seeking data of users with $20,000 or more in cryptocurrency transactions during the years 2016 to 2020.
IRS Wants User Information From Crypto Exchanges
The U.S. Department of Justice (DOJ) announced Wednesday that a federal court in the Northern District of California has authorized the IRS “to serve a John Doe summons on Payward Ventures Inc., and subsidiaries d/b/a Kraken.”
The IRS is “seeking information about U.S. taxpayers who conducted at least the equivalent of $20,000 in transactions in cryptocurrency during the years 2016 to 2020” on Kraken cryptocurrency exchange, the DOJ described.
According to the summons filed:
IRS directed Kraken to produce records identifying the U.S. taxpayers described above, along with other documents relating to their cryptocurrency transactions.
IRS Commissioner Chuck Rettig commented: “This John Doe summons is part of our effort to uncover those who are trying to skirt reporting and avoid paying their fair share.”
The court document explains that the order seeks information related to the IRS’ “investigation of an ascertainable group or class of persons” that the tax agency has “reasonable basis to believe may have failed to comply with internal revenue laws.”
The IRS has demanded user data from other crypto exchanges before. In April, a federal court in the District of Massachusetts granted an order authorizing the IRS to serve a similar John Doe summons on Circle and Poloniex. In addition, Coinbase was served a similar order, which the exchange fought for more than a year before complying and handed over data of about 14,000 customers. According to Coinbase, that number represented a 97% reduction in the number of customers impacted by the summons.
What do you think about the IRS demanding information on crypto users? Let us know in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Read disclaimer
