The Internal Revenue Service has asked a court to dismiss a motion filed by a Coinbase user who wants the court to block the IRS from accessing transaction data.
According to a report by Forbes, the IRS, in a motion filed on Tuesday (Dec. 27), asked the court to dismiss the motion filed by the Coinbase customer and let the IRS proceed with issuing a so-called “John Doe” summons to Coinbase, which would require Coinbase to hand over information on all Coinbase customers who transferred bitcoin from 2013 to 2015. The original John Doe summons was granted by a judge who found there was reasonable basis to believe that the Coinbase customers “failed or may have failed to comply with any provision of any internal revenue laws and that the information sought to be obtained from the examination of the records or testimony (and the identities of the persons with respect to whose liability the summons is issued) are not readily available from other sources,” according to the report.
In response to that ruling, a Coinbase customer, Jeffrey K. Berns, sued to get that ruling set aside, and now, the IRS had its turn with the courts. Berns argues the John Doe summons was too broad and would expose private customer data. The IRS, for its part, argued the John Doe summons was to get information on certain unknown tax payers, and now that Berns has outed himself as a Coinbase customer, it doesn’t need the John Doe summons for Berns. As a result, the IRS withdrew its motion for only Berns. Coinbase previously stated it would oppose government efforts to obtain customer information. The company is the largest virtual currency exchange in the U.S. It is licensed in 34 states, the District of Columbia and Puerto Rico and operates in 32 countries.