Drudge Retort: The Other Side of the News
Thursday, December 01, 2016

A federal judge authorized a summons Wednesday requiring the largest Bitcoin service in the U.S. to provide the IRS records of every user who traded on the site between 2014 and 2015. Covering the identities and transactions of millions of customers, the request to Coinbase is believed to be the largest single attempt to identify tax evaders using virtual currency. The "John Doe" summons targets a particular group or class of taxpayers -- rather than individuals -- the agency has a "reasonable basis" to believe may have broken the law. According to the New York Times, the IRS argued that two cases of tax evasion involving Coinbase combined with Bitcoin's "relatively high level of anonymity" serve as that basis.

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That's the fast way to cause an exodus to countries that don't define bitcoin as currency.

#1 | Posted by sitzkrieg at 2016-12-01 09:10 AM | Reply

I can see the IRS wanting to tax bitcoin profits. But will they accept bitcoins as payment?

#2 | Posted by nutcase at 2016-12-01 09:45 AM | Reply

"That's the fast way to cause an exodus to countries that don't define bitcoin as currency."

If it's being exchanged for goods or services, how is it not currency?

Put another way, barter is taxable; why should barter via bitcoin be any different?

#3 | Posted by Danforth at 2016-12-01 09:59 AM | Reply

I didn't say it shouldn't be taxed. I said this would drive mining and exchanges to setup in countries that do not define it as currency.

#4 | Posted by sitzkrieg at 2016-12-01 10:13 AM | Reply | Newsworthy 1

Think the IRS just opened a Pandora's Box with that. What if Coinbase demands FDIC insurance after they are forced to give up the list. Not that I think people should evade taxes, but they are risking there money that this company stays afloat, and if the IRS wants the list they should have to back the money that's risked.

#5 | Posted by PinkyanTheBrain at 2016-12-01 11:14 AM | Reply

I'm a big fan of Bitcoin, and at least in this situation it seems like if you're not involved with coinbase, you're unaffected and won't be added to the government watchlist or red flagged in any way.

#6 | Posted by GOnoles92 at 2016-12-01 11:23 AM | Reply

It seems sitzkreig supports corporate extortion of what ought to be sovereign government. We see how this plays out in the Carrier-Trump story:

www.commondreams.org

#7 | Posted by nutcase at 2016-12-01 12:03 PM | Reply

There is something you can do. You can dissolve a Corporation whenever it engages in illegal activity. The problem is that has only happened once or twice in US history.

#8 | Posted by nutcase at 2016-12-01 12:05 PM | Reply

You can dissolve a Corporation whenever it engages in illegal activity. #8 | POSTED BY NUTCASE

In an indirect manner, are you alleging that Coinbase engages in illegal activity?
Others see this action as the US govt attempting to investigate a facilitator of an anonymous, sovereign currency.

#9 | Posted by GOnoles92 at 2016-12-01 12:30 PM | Reply

It seems sitzkreig supports corporate extortion of what ought to be sovereign government.

#7 | POSTED BY NUTCASE AT 2016-12-01 12:03 PM | REPLY

It seems you have no idea what I think, and can't recognize cause-effect relationships in how businesses setup internationally.

#10 | Posted by sitzkrieg at 2016-12-01 12:33 PM | Reply

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Noles I like bitcoin, a buddy of mine was one of the original programmers and if I had listened to him I would be posting this from my Malibu McMansion instead of McDonald's on my 15 minutes to scarf down "food" that I call a lunch break. All that said bitcoin is not a sovereign currency. It is backed by no government and has no store of wealth to draw on.

Not sure this move by the IRS is the best way to go about taxing bitcoin transactions but they will come up with some way to get their pound of flesh. As the taxing authority for a real sovereign currency they have every right to.

#11 | Posted by TaoWarrior at 2016-12-01 01:04 PM | Reply

What if Coinbase demands FDIC insurance after they are forced to give up the list. Not that I think people should evade taxes, but they are risking there money that this company stays afloat, and if the IRS wants the list they should have to back the money that's risked.

Seems like they already have tried...

"Winklevoss Twins to Launch Bitcoin Exchange with FDIC Insured Deposits"
insidebitcoins.com

Seeking FDIC insurance would open up the institution to regulation.

#12 | Posted by 726 at 2016-12-01 02:46 PM | Reply | Newsworthy 1

"I said this would drive mining and exchanges to setup in countries that do not define it as currency."

That doesn't matter to Americans. Any money they make, worldwide, is subject to US tax law.

"Not sure this move by the IRS..."

This is nothing new. I've been reporting to my tax clients for several years about the IRS taxing bitcoin profits the same as cash. The IRS simply wants what it has with W-2s and 1099s: A second, independent source to match to the taxpayer's claims.

#13 | Posted by Danforth at 2016-12-01 03:02 PM | Reply

Thanks 726 that was a good read. Sounds like it won't happen anytime soon but good info.

#14 | Posted by PinkyanTheBrain at 2016-12-02 09:29 AM | Reply

It seems sitzkreig supports corporate extortion of what ought to be sovereign government.
#7 | POSTED BY NUTCASE AT 2016-12-01 12:03 PM | REPLY
It seems you have no idea what I think, and can't recognize cause-effect relationships in how businesses setup internationally.
#10 | POSTED BY SITZKRIEG

You hadn't realized this before?

#15 | Posted by Sycophant at 2016-12-02 11:16 AM | Reply

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