The IRS Claims FTX Owes $24 Billion in Taxes
The Internal Revenue Service (IRS) has stated that FTX, the collapsed crypto exchange, owes it $24 billion in unpaid taxes. This could potentially delay payouts to victims of the exchange’s collapse, as the funds would be taken away from them.
Lawyers for FTX Request Substantiation of Tax Claim
In a court filing, the legal team for FTX requested the IRS to substantiate its claim for $24 billion in taxes. They also asked the IRS to provide details on how it came to this estimate.
FTX’s Legal Team Challenges IRS Claim
FTX’s legal team submitted a filing to a Delaware bankruptcy court, disputing the IRS’s tax claim. They argue that if the claim is upheld, it would hinder any meaningful recovery for victims of the FTX fraud. The lawyers describe the IRS’s argument as having no legal support.
FTX Claims It Owes Nothing to the IRS
FTX maintains that it does not owe the IRS any taxes and argues that the demand of $24 billion is far higher than the amount it has available to repay creditors. The lawyers state that FTX never earned enough income to support such a claim, and in fact, incurred significant losses.
IRS Initially Demanded $44 Billion
The IRS initially claimed that FTX owed it approximately $44 billion but later reduced the amount to $24 billion. The agency says this amount is related to income taxes, employment taxes, and penalties for the years 2018 to 2022.
Hot Take: FTX’s Legal Battle with the IRS
The legal battle between FTX and the IRS over $24 billion in unpaid taxes could have significant implications for the victims of FTX’s collapse. If the IRS’s claim is upheld, it could prevent victims from receiving any meaningful recovery. FTX’s lawyers argue that the IRS’s demand is baseless and would only delay payouts to those who have already suffered as a result of the fraud. This ongoing dispute highlights the challenges and complexities of regulating the crypto industry and resolving financial matters in the aftermath of exchange failures.
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