Coinbase Ordered to Turn Over Identities of 14,355 Cryptocurrency Traders to the IRS
On Tuesday, a California federal court ordered the popular cryptocurrency exchange and wallet service Coinbase to turn over records on thousands of customers to the Internal Revenue Service.
The requested records include the name, birthdate, address, and account activity for any user who bought, sold, sent, or received more than $20,000 worth of Bitcoin in their accounts between 2013 and 2015.
US citizens are supposed to pay capital gains tax on cryptocurrency transactions and the IRS labels virtual currencies as property for federal tax purposes. As the court order shows, more than 10,000 people bought or sold more than $20,000 worth of cryptocurrency, but only “800 to 900 taxpayers a year have electronically filed returns with a property description related to bitcoin from 2013 through 2015.”
This “suggests that many Coinbase users may not be reporting their bitcoin gains,” the order reads.