Jeffrey Berns responds anew to IRS efforts to identify bitcoin users

Regulation | January 6, 2017 By:

Coinbase customer and attorney Jeffrey Berns filed an answer to the IRS’ response to his motion to intervene and quash a “John Doe” summons served by the IRS on Coinbase to identify bitcoin users.

The case began in November of 2016 when the IRS presented Coinbase with a summons requiring the company to disclose client transactions between 2013 and 2015. Coinbase has hinted that they’d rather not. Shortly thereafter, Jeffrey Berns presented a motion against the IRS, alleging the subpoena was too broad.

On December 27, 2016, the IRS filed a motion in court to allow the tax agency to proceed with the “John Doe” summons. The IRS argued, in part, that since Berns had “outed” himself as a Coinbase customer, he was no longer subject to the summons. That means, argued that IRS, that the matter as it affects Berns was resolved, making the motion moot and clearing the way for IRS to begin to identify Coinbase customers.

Berns’ law firm responded by saying, “The IRS’ willingness to withdraw the summons as to Mr. Berns only because it is now aware of his identity makes it clear that the IRS does not have a legitimate purpose in seeking substantial personal and financial information concerning approximately 3 million Americans.”

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.