- The agency wants the data for users who transacted over $20k between 2016 and 2020.
- IRS accuses Kraken of not complying with the summons issued earlier.
Cryptocurrency exchange Kraken has been ordered by the federal court to submit information related to the historical transactions and users’ accounts to the Internal Revenue Service (IRS). The agency reportedly wants to check if there are any underreported taxes by the exchanges’ users.
IRS filed a petition in the Northern District of California in February seeking to have the data of customers who transacted more than $20,000 between 2016 and 2020. In the filing, the taxman accused the crypto exchange of failing to comply with the earlier summons issued in 2021.
“Despite the discussions between the parties, Payward Ventures Inc. (one of the affiliated entities to Kraken) has failed to comply with the summons and has not produced the books, records, papers, and other data demanded in the summons,” IRS said in the petition.
Requested Information
Specifically, the IRS wants the account details, including user names, birthdates, taxpayer identification numbers, addresses, phone numbers, and email addresses, among other information. Additionally, the tax agency is demanding blockchain addresses and transaction hashes.
However, Judge Joseph Spero, the judge presiding over the matter, has declined some of the IRS’ requests, including the request to be provided with the employees’ information and their sources of wealth.
“The Court finds that to the extent the first three requests are aimed at establishing the identities of the Kraken account holders who fall within the Doe definition, the information sought in these requests is much broader than what is necessary to achieve that purpose for the vast majority of Doe users,” Judge Spero wrote.
IRS’ filed the petition against Kraken immediately after the exchange announced that it had agreed with the Securities and Exchange Commission (SEC) to end its staking-as-a-service program for the US clients and to pay the regulator $30 million in fines. According to the exchange’s website, the staking service offered a 20% yield.
