U.S. Court Permits IRS to Serve Crypto Broker with a John Doe Summons
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Additionally, the U.S. federal agency is looking for records from Americans who dealt with or through sFOX Inc, a digital currency dealer in San Francisco, California, and did not declare the funds on their tax filings. Deputy Assistant Attorney General David A. Hubbert of the Tax Division of the Justice Department said,
"The information sought by the summons approved today will help to ensure that cryptocurrency owners are following the tax laws."
John Doe Summons
The IRS is now reviewing new tax reporting rules and seeking to crack down on defaulters. Thus, the summons will be issued now. The IRS has long utilized the John Doe summons, which was allowed by the U.S. Supreme Court in the 1975 case of United States v. Bisceglia and later codified by Congress, as a potent weapon to prosecute tax fraud schemes and to gather complete information about Bitcoin transactions.
Coinbase And Mastercard Summoned Earlier
The statement claims that because cryptocurrencies are difficult to track and have a pseudo-anonymous quality, people may use them to conceal taxable income from the IRS. It will look into people who have disregarded American tax regulations. Previously, the IRS served credit card firms like Mastercard and Visa with John Doe summonses to help track down taxpayers who had not made their required tax payments. Additionally, it has collected data on Bitcoin exchanges like Coinbase.