US Court Hints IRS May Have Violated Coinbase User’s Privacy Rights in Tax Audit

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An American owner of bitcoin (BTC) trying to fight it Internal revenue service about the seizure of your data from the Coinbase The trading platform could have the opportunity to challenge the tax body over the controversial measure.

Reuters reported that yesterday a three-judge federal appeals court, the first US circuit court of appeals in Boston, had “harshly questioned” the reasons why the bitcoiner, named Jim Harper, was unable to sue the IRS for violations. Of privacy.

The Supreme Court had previously ruled against Harper when, in 2020, he tried to take the IRS to court. The tax body had written to Harper alleging that he had “obtained information” that appeared to show that he may not have correctly reported crypto transactions in tax filing documents.

The IRS legal team responded by warning that ruling in Harper’s favor “could open the door to further lawsuits” by crypto holders currently “under audit,” adding:

“There is nothing that can prevent that from happening.”

Harper was one of thousands of US crypto holders to whom similar letters were sent after the IRS won a key legal battle in 2017 to enforce a “John Doe” subpoena against Coinbase, forcing the release of data from user transactions. The IRS applied a similar subpoena to Coinbase’s crypto exchange rival Kraken at the beginning of this year.

But the news agency quoted Harper’s attorney, Richard Samp, as telling the judges:

“[The IRS] He said: We are going on a fishing expedition. Let’s ask Coinbase for information on hundreds of thousands of contributors. “

A lawyer from the Justice Department (DoJ), arguing the IRS case, claimed that Harper’s attempt to sue had been rightly rejected under the Anti-Mandate Act, which prohibits lawsuits to restrict the “assessment or collection” of taxes.

However, Harper’s legal argument centers on the way his data was obtained, and it appears that the judging panel may have sympathized with this line of reasoning.

One of the judges, Kermit Lipez, told the Justice Department attorney that the “plain” language of the ruling showed that “his position is not defensible.” Lipiz added:

“We are involved perhaps with a prelude to an act of evaluation, but not with the act of evaluation itself.”

Learn more:
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