The IRS will no longer target a wide-range of Coinbase users via its information request, which it filed on Coinbase back in March. Instead, the agency made concessions to seek account data of individuals who transacted — meaning they bought, sold, sent, or received — $20,000 worth of bitcoin in any transaction type.
Also read: Israeli Official Urges Regulators to be More ‘Paternalistic’ Regarding ICO’s and Bitcoin
A July 6 court document revealed the request: “The United States seeks information (delineated below in 3a-f) for users (“covered users”) with at least the equivalent of $20,000 in any one transaction type (buy, sell, send, or receive) in any one year during the 2013-2015 period.
The IRS is seeking a variety of information on these “covered users.” It is requesting addresses, drivers license and passport information, all wallet addresses and public key details.
Early Concessions and Coinbase User Push Back
The IRS made concessions to only go after these heavier users after they received ample push back last week from Coinbase and several anonymous users. This caused DOJ attorney Amy Matchison to narrow all requests for information. Both the John Doe users and Coinbase argued the data request was over-broad and unnecessary. It could actually put users at risk.
Bitcoin.com covered the story last week, saying,
In a June 22 “Motion to Intervene” court document, the plaintiffs mentioned that all the excess personal information requested by the IRS could easily be retrieved by hackers. This would compromise personal account information from Coinbase users. The document cited the IRS has not been careful with other people’s documents, and they lose sensitive information to nefarious entities too often.
Originally, the IRS sought a plethora of information, ranging from all users. They wanted vault data, account information, security settings, monetary transfer details, and a number of other things.
Will the IRS Request More Information?
However, according to the most recent court document, the IRS could still seek more information regarding certain users. The document detailed, “The United States reserves the right for the Internal Revenue Service to issue Summonses in individual examinations of Coinbase users for the information that it no longer seeks in this proceeding.”
In other words, the IRS could call upon individual Coinbase users who transacted in any amount of Bitcoin. Nonetheless, the IRS may use the present proceeding as a foothold to gather more data in their hunt for people who use Bitcoin or other digital currencies.
Do you believe the IRS will seek more information at a later date? Should Coinbase continue to push back? Let us know in the comments below.
Images via Shutterstock and coinbase.com
Bitcoin is cool, and you know everyone wants in – even the ones who say they don’t. Show the world how cutting-edge you are with a bitcoin T-shirt, hoodie, bag, key-ring, even a Trezor hardware wallet. Shipping all over the world, quality merchandise and, of course, a payment system that makes people say “wow”!