LIVEFTX settles $24 billion debt with the IRS for $885 million?
FTX, the now-bankrupt cryptocurrency exchange, announcing a proposed settlement for a nearly $24 billion tax claim with the IRS for $885 million.
A motion filed in the Delaware Bankruptcy Court on Monday, June 4, 2024, states that FTX will pay $200 million within 60 days of the company’s planned restructuring plan going into effect. The other $685 million subordinated claim is a lower-priority claim and will be payable to consumers and other debtors “to the extent of funds available.”
According to court documents, a letter dated May 20, 2024, from Deputy Assistant Attorney General David Hubbert to FTX’s lawyers indicated that they had accepted the offer proposed by FTX. A hearing on the motion will be held on June 25, 2024, at 10 a.m. before the Honorable John T. Dorsey in Delaware.
The IRS initially filed a tax claim against FTX for more than $44 billion, which was later amended to $24 billion. FTX vigorously disputes the claims, including the income tax liability for “misappropriation income” resulting from Sam Bankman-Fried’s theft of customer funds, among other claims.
Another employee facing a prison sentence after a recent sentencing. On May 28, 2024, a federal judge sentenced a former FTX executive, Ryan Salame, to 7.5 years in prison. Last year, he pled guilty to illegally making unlawful U.S. campaign contributions and to operating an unlicensed money-transmitting business.
In November 2022, FTX sought bankruptcy protection after the exchange experienced the crypto equivalent of a bank run. FTX, the hedge fund Alameda Research, and dozens of other affiliated companies filed a bankruptcy petition in Delaware on Friday morning. FTX US, which originally was not expected to be included in any financial rescue, was also part of the company’s bankruptcy filing.
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