According to PANews, the rapid rise of the cryptocurrency market has brought regulatory risks, particularly in tax compliance, to the forefront. In April 2024, Roger Ver, known as 'Bitcoin Jesus,' was accused by the U.S. Internal Revenue Service (IRS) of evading $48 million in taxes and was subsequently arrested in Spain. This case has been closely watched by the cryptocurrency industry, highlighting the importance of tax compliance within the sector.
As Bitcoin surpassed $100,000, the case involving Roger Ver saw new developments last week. On December 4, 2024, Ver's legal team filed a motion to dismiss the IRS's tax evasion charges. Ver remains in Spain, awaiting a decision on extradition to the United States. TaxDAO provides a retrospective on the 'Bitcoin Jesus' case and offers compliance advice regarding related tax risks.
Roger Ver, born in 1979 in Silicon Valley, is a well-known libertarian and anarchist. He founded Memory Dealers in 1999, a company specializing in reselling computer parts, and became a millionaire by age 24. In 2011, Ver began investing in Bitcoin and announced that Memory Dealers would accept Bitcoin payments, making it the first company globally to do so. Ver continued to purchase and receive Bitcoin personally and through his companies, eventually becoming the CEO of Bitcoin.com and a founding member of the Bitcoin Foundation. His advocacy for Bitcoin's use and value earned him significant influence in the cryptocurrency community, leading to his nickname 'Bitcoin Jesus.'
The IRS's lawsuit against Roger Ver stems from his acquisition of citizenship in Saint Kitts and Nevis in 2014 and subsequent renunciation of his U.S. citizenship. U.S. tax law requires individuals renouncing citizenship to report their global assets' capital gains, including Bitcoin holdings and fair market value. The IRS alleges that Ver underreported his assets before renouncing his citizenship and later sold approximately 70,000 Bitcoins from U.S.-based companies he controlled, generating nearly $240 million in revenue, thereby evading at least $48 million in taxes.
The IRS's charges against Ver include two main allegations: first, that he failed to comply with exit tax regulations by underreporting the actual quantity of Bitcoin held by him and his companies, thus avoiding tax obligations. Second, after renouncing his U.S. citizenship, Ver allegedly violated tax obligations as a non-U.S. tax resident by not reporting income from Bitcoin sales conducted through U.S.-based companies he controlled, thereby evading taxes.
