Just when things had really started to look good for the victims of FTX the Internal Revenue Service (IRS) decided to come in and try to nuke the whole landscape. On Sunday FTX lawyers filed a response to the ongoing battle between the IRS and FTX over taxes the IRS claims that they are owed. The number is by no means small either as the IRS has stated that they want up to $24 billion an absolutely insane amount of money for a company that not only lasted only 3 years but also is in bankruptcy.
FTX claims that they do not owe the IRS anything because it never distributed dividends or earnings and more importantly "never earned anything anywhere near the amount that could support the IRS claims for $24 billion in taxes". Just thinking about it logically you never see any of the major companies in the US pay taxes that high even when you break it up into 3 years or $8 billion a year. Factoring in that companies are able to write off losses it really bamboozled the mind that the IRS is asking for this and thinks that it will have a case for that amount. After all the company went bankrupt so they lost more money than they had at the end of the day!
Now $24 billion sounds like a lot but what is even crazier is that the IRS initially, in April, said that FTX owed $44 billion! I honestly want to know what those people are on because it just does not make any sense whatsoever! In September they filed an amendment to the amount lowering it by a whopping $1 billion to $43 billion being owed to the IRS! It was only in November that they slashed it down to $24 billion. Since the IRS is the type of entity that gets its first slice of the pie when it comes to carving up and paying out the assets even this "lower" amount would wipe out everything that the FTX team has recovered.
I could not imagine being someone with an FTX.US account and thinking hey I lost a lot but I still might get a little slice of the pie back to seeing this and going welp not only is the IRS taking it all but once they are done even if there was more money they would never be able to pay back the priority creditors and get to the average person. You would think that the government for all its calls about being fair to the average person like they have so publically claimed would actually act upon this but no. The government wants its money come hell or high water and is more than willing to bleed dry whatever remains of FTX just to make a point. I hope that the court, which was meeting today over this, moves quickly to strike down the IRS for the sake of those who lost so much in the FTX collapse!
Please know I am not a financial advisor and make sure you do your own research! If you enjoyed this article and would like to support me further below are a few referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_
Robinhood
Robinhood is offering an excellent signup deal if you use my link here where we will both be awarded free stock. All that you have to do is sign up and connect your bank account for the award! With commission-free crypto trading and the ability to set limit orders, it is a great hybrid offering in my opinion! Not to forget the addition of wallets and the ability to send and receive crypto!
Fold App
Offers daily wheel spins to win free sats daily! If you sign up for Fold with my link here you will get 20,000 sats for free!
Unstoppable Domains
Sign up using my link here and get a free $10 credit towards your first $40+ purchase!
