Bitcoin Exchange Coinbase To Comply With IRS Tax Summons

by Mike Godfrey, Tax-News.com, Washington

28 February 2018

Coinbase, a virtual currency wallet and virtual currency exchange service provider, has confirmed it will soon transmit information on the transactions of 13,000 customers to the Internal Revenue Service, as a result of an earlier court ruling.

In IRS v. Coinbase, Case No. 17-cv-01431-JSC, the United States District Court for the Northern District of California ordered Coinbase to provide the taxpayer ID, name, birth date, address, and historical transaction records for certain higher-transacting customers covering the 2013-2015 period.

The case follows a December 2016 summons received by the company from the IRS, which demanded that Coinbase produce a wide range of records relating to approximately 500,000 Coinbase customers. Coinbase fought the summons in court. After a long process, the Court issued an order, which Coinbase said was "a partial, but still significant, victory for Coinbase and its customers," in providing that Coinbase should produce only certain limited categories of information from the accounts of approximately 13,000 customers.

Coinbase has newly sent correspondence to the 13,000 taxpayers concerned, warning them of the upcoming disclosure, which stated: "We are writing to let you know that the above-described court order requires us to produce information specific to your account. If you have concerns about this, we encourage you to seek legal advice from an attorney promptly. Coinbase expects to produce the information covered by the court's order within 21 days."

TAGS: court | money-laundering | tax | law | enforcement | United States | currency | penalties