Yesterday, CoinBase lost a year-long battle with the IRS and is now having to turn over the records of its users.
A California federal court has ordered the company to disclose the records of users that sold, sent, or bought over $20,000 worth of cryptocurrency on its platform between the years 2013 and 2015. As per CoinBase’s calculations, 14,355 users have met the government’s stipulations and their information will have to be handed over.
For each of these accounts, they need to provide the IRS the client’s name, date of birth, physical address and taxpayer ID, along with the account activity records.
The new order is significantly smaller than the original, in which the IRS requested access to every single CoinBase user’s account information which has over 10 million customers. The reason behind the summoning is the fact that less than $1,000 US citizens a year, claim that they hold any cryptocurrencies. Coinbase’s employee David Farmer reported after a hearing this month, “In the future, we hope to work with the IRS to establish a reasonable tax reporting method that makes sense for virtual currency service providers and consumers alike.”
The ruling comes at a very bad time for CoinBase as a freeze in their system yesterday caused most cryptocurrencies to drop.
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