IRS got access to Circle’s user data, ensuring the crypto owners that they are paying their shares of taxes fairly. Now they also want to dig into Krakens’ data so let’s find out more in our latest cryptocurrency news today.
Right after getting a court authorization to obtain the records of Circle’s crypto exchange customer, the US IRS got access to the data and now wants to get similar data access from the trading platform Kraken, as the assistant attorney general David Hubbert of the Justice Department’s Tax Vision said:
“Those who transact with cryptocurrency must meet their tax obligations like any other taxpayer. The Department of Justice will continue to work with the IRS to ensure that cryptocurrency owners are paying their fair share of taxes.”
Earlier this week, the federal court in Massachusetts approved the IRS’s request to serve a John Doe summons on the Circle Internet Financial Inc or its subsidiaries, predecessors, divisions, and affiliates including Poloniex. With this move, the IRS wants to identify the taxpayers who transferred $20,000 or move via transactions that involved crypto assets between 2016 and 2020, and according to the regulator, it needs the documents of the exchange to check if those traders are paying their taxes in full, as IRS Commissioner Chuck Rettig added:
“Tools like the John Doe summons authorized today send the clear message to U.S. taxpayers that the IRS is working to ensure that they are fully compliant in their use of virtual currency. The John Doe summons is a step to enable the IRS to uncover those who are failing to properly report their virtual currency transactions. We will enforce the law where we find systemic non-compliance or fraud.”
After circle, the DOJ filed a similar request for the regulator with the United States District Court for the Northern District of California looking for user data from Kraken. However, this time around, the court denied the initial filing and argued that it is “overboard” and the IRS has to cut down on the request. The Judge’s order said:
“Any such response must specifically address why each category of information sought is narrowly tailored to the IRS’s investigative needs, including whether requests for more invasive and all-encompassing categories of information could be deferred until after the IRS has reviewed basic account registration information and transaction histories.”
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