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U.S. tax authorities seek $44 billion from FTX bankruptcy, details here
Enforcement action against the bankrupt crypto exchange FTX seems to be tightening further as tax authorities in the U.S. filed claims worth $44 billion against the exchange.
- U.S. filed claims worth $44 billion against bankrupt crypto exchange FTX.
- The largest claims include $20.4 billion, $7.9 billion and $9.5 billion against different subsidiaries of Alameda Research.
The U.S. Department of Treasury and Internal Revenue Service (IRS) filed claims worth $44 billion against bankrupt crypto exchange FTX and its subsidiaries.
In a tax bill, the IRS assessed that FTX’s sister firm Alameda Research LLC owed the IRS $20.4 billion in partnership taxes and payroll taxes. The evaluation appears to be consistent with the IRS’s claim seen on Kroll’s Restructuring Administration practice platform.
The IRS filed 45 claims against FTX entities, including West Realm Shires (the legal entity of FTX.US), Ledger Holdings (the parent company of LedgerX and LedgerPrime), and Blockfolio.
The largest claims include $20.4 billion and $7.9 billion against Alameda Research and two other claims worth $9.5 billion against Alameda Research Holdings Inc.
The IRS filed the claims under “Admin Priority,” which allowed its claims to take precedence over those of unsecured creditors during the bankruptcy proceedings.
An IRS spokesperson said,
“Federal law prevents the IRS from confirming or denying any correspondence with regard to any taxpayer case.”
Imbalance between assets and liabilities continues
FTX’s bankruptcy counsel said that they found more than $5 billion in various assets during a hearing in January. As per the initial bankruptcy filings FTX has around $1 billion-$10 billion in assets.
These metrics have shifted as the company’s management raised new capital in recent months.
Alameda Research was based in Hong Kong. But its founders and other executives such as Bankman-Fried and Caroline Ellison are American citizens.
Unlike most other nations, the U.S. has a taxation-by-citizenship regime. This means that U.S. nationals must pay taxes on their worldwide income regardless of where they live or how much time they spend in the U.S. each year.
Taxes are not paid at the partnership level for partnership entities. Instead, they are passed through to their participants and taxed at the individual level.
