- The judge said the government had a legitimate purpose for seeking the materials
- The Internal Revenue Service is trying to find out if the exchange’s customers were dodging taxes
Federal court ordered cryptocurrency exchange Kraken to turn over customer account and transaction information to the IRS. The IRS reported that such information is needed to verify that users have declared their taxes correctly and have not evaded paying. The service demanded that the exchange identify accounts that traded at least $20,000 worth of cryptocurrency between 2016 and 2020.
In February, the IRS had already filed a motion in Northern District of California court, just after Kraken settled its disputes with the SEC. At the time, the company refused to comply with the request, claiming it would become too difficult a task.
In a recent statement, it writes that Kraken must turn over to the IRS information about users who have made transactions over $20,000 in a calendar year. User names (including any aliases), date of birth, taxpayer identification number, address, phone number, email, blockchain addresses and transaction hashes must also be transmitted.
Judge Joseph Spero, who oversaw the case, said:
“The government has a legitimate purpose to obtain the materials referenced in the subpoena. As noted, the subpoena was issued as part of an IRS investigation to identify individuals and determine their federal income tax liability. This applies to individuals who conducted cryptocurrency transactions between 2016 and 2020.”