According to a report from “The Block,” court documents reveal that the US government’s total claim against the cryptocurrency exchange FTX is expected to be between $3 billion and $5 billion, with the specific amount potentially changing due to negotiations with the authorities.
The filed documents on Wednesday (20th) indicate that the total amount of the US tax claims is still unclear. However, once all government and tax claims are paid, the debtor can distribute the remaining income to shareholders.
It should be noted that, according to Chapter 11 of the Bankruptcy Code regarding the priority of property compensation, FTX customers, Alameda Research lenders, administrative expenses, and non-governmental creditors’ claims will be paid before any government and tax claims.
According to the court documents, the debtor proposes to allocate 100% of the “SNDY Exempt Funds” (i.e., funds or assets returned to the FTX bankruptcy estate as part of an exemption program by the US Attorney’s Office for the Southern District of New York or other government agencies) to be distributed to FTX.com customers and Alameda lenders, including the settlement arrangement with the cryptocurrency lending company BlockFi.
The documents state that after payment of administrative expenses and non-governmental creditor claims, up to 25% of the distributable value will be used to pay claims for US federal income tax, while the remaining portion will be used to pay claims from the Commodity Futures Trading Commission (CFTC) and other government agencies.
Related report: “Judge rules for a hearing early next year to expedite the resolution of FTX’s £2.4 billion tax dispute with the IRS.”
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