Cryptocurrency

IRS secures court approval to probe records of M.Y. Safra Bank, SFOX users over failure to report taxes

Zegex

On Sept. 22, a U.S. judge filed an Internal Revenue Service (IRS) petition requiring MY Safra Bank to provide records of taxpayers who may not have filed or paid taxes on cryptocurrency transactions. admitted.

Specifically, the IRS is interested in the records of users of SFOX, a prime cryptocurrency broker, a source said. press releaseMY Safra Bank, based in New York, provided banking services to SFOX customers for cryptocurrency trading, the federal prosecutor’s office said in a press release.

Taxpayers are required to report any gains or losses related to cryptocurrencies on their tax returns. However, the U.S. Attorney’s Office said the IRS has found significant gaps in tax compliance regarding digital assets.

IRS Commissioner Charles P. Rettig said:

“Governments’ ability to obtain third-party information on people who have not reported profits from digital assets continues to be an important tool for catching tax fraud… Any taxpayer who has a tax liability must comply with its filing and reporting responsibilities.

According to a press release, the IRS discovered “substantial underreporting” of cryptocurrency trading through subpoenas issued to other cryptocurrency dealers. Additionally, the IRS has identified at least 10 taxpayers who used SFOX for cryptocurrency transactions but did not report as required by law.

As a cryptocurrency prime dealer and trading platform, SFOX connects cryptocurrency exchanges, over-the-counter digital asset brokers, and liquidity providers. In total, since 2015, he has served more than 175,000 of his registered users who have transacted more than $12 billion, according to a press release.

SFOX has partnered with MY Safra bank to give users access to cash deposit accounts. Users can use cash to trade cryptocurrencies through these accounts.

According to a press release, the IRS expects MY Safra to be able to provide information about the identity and cryptocurrency transactions of SFOX users who have used the bank’s services. The IRS uses information from MY Safra Bank and other sources to assess gaps in tax compliance.

The U.S. Attorney’s Office for the Southern District of New York said the subpoena being issued does not match the allegations of wrongdoing. It is a means of revealing information about a person.

The IRS also received a green light from SFOX itself on August 15 to process a subpoena requesting customer transaction records.

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