FTX says IRS demand for $24 billion in unpaid taxes is delaying recovery of user funds

Lawyers for FTX said in a new filing in Delaware bankruptcy court on Sunday that the IRS should substantiate its claims against FTX and show how it estimated the back taxes it said were due. The move is the latest development in a months-long dispute between the IRS and the FTX bankruptcy estate over the amount of unpaid taxes the bankrupt exchange and its affiliates owe the government. Although FTX claims it owes nothing to the IRS, the tax agency is seeking up to $24 billion in taxes, more than three times the amount the property is currently spending to try to recoup losses from creditors. During its brief three-year life, FTX never distributed dividends or earnings and "never earned anywhere near the amount needed to support the IRS' alleged $24 billion tax claim," the attorneys wrote. Instead, FTX lost significant amounts of money, they added. "The IRS's only recourse is through taking damages from victims," ​​the attorneys argue in the filing. "With no basis for a tax claim against the debtor, the IRS's reliance on its own procedures will only delay the recovery of true victims." Distribution of Injured Persons.”