FTX and IRS Reach Priority Tax Deal, Resolving Multi-Billion Dispute
CryptoNewsTerminal Staff04 Jun, 2024
FTX and IRS Reach Priority Tax Deal, Resolving Multi-Billion Dispute
FTX, the bankrupt cryptocurrency exchange, has agreed to pay the U.S. Internal Revenue Service (IRS) $200 million as a priority claim, resolving a tax dispute that once amounted to $2.4 billion. The IRS claimed that FTX and its affiliates owed $440 billion in taxes last May, later revising the figure down to $240 billion. FTX disputed the size of the tax bill and filed a motion with the court to have it thrown out. Under the terms of the settlement, the IRS will receive a priority claim for the $200 million owed, which will be paid within 60 days of FTX's reorganization plan becoming effective. The IRS will also receive a subordinated claim of $685 million, which will be paid if there is money left after customers and other creditors are repaid. "The agreement resolves the IRS’s substantial tax claims against the debtors for a fixed and certain amount, which will facilitate the Chapter 11 process by providing greater clarity regarding the tax liabilities of the debtors," FTX said in a statement. "This will enable the debtors to distribute assets to creditors and customers more expeditiously." ---
