- Roger Ver has filed a motion to dismiss an eight-count federal indictment, citing unconstitutional grounds and due process violations
- Ver argues that the charges rely on vague tax laws and improper handling of attorney-client privileged material by the government
- The motion emphasizes Ver’s reliance on expert legal advice during his expatriation process and disputes the government’s claims of willful misconduct
Early Bitcoin evangelist Roger Ver is seeking to dismiss federal charges of tax evasion stemming from his expatriation and related tax filings. His legal team filed the motion yesterday, arguing that the indictment is based on unconstitutional applications of tax law, including the US “exit tax,” and selectively omits exculpatory evidence. The filing also raises concerns about the government’s alleged breach of attorney-client privilege during its investigation.
Ver’s Expatriation Ruffles Feathers
Roger Ver became a prominent figure in the cryptocurrency world for championing Bitcoin’s adoption in its early days. He expatriated from the United States in 2014, relinquishing his citizenship and triggering the US exit tax, which requires expatriates to report and pay taxes on unrealized capital gains.
The government claims Ver underreported the value of his assets, particularly his extensive cryptocurrency holdings, resulting in alleged tax violations. Ver’s legal team disputes these allegations, pointing out that in 2014, the tax treatment of digital assets was ambiguous, with the IRS issuing its first cryptocurrency guidance weeks after Ver expatriated.
Constitutional Arguments and Due Process Claims
The motion to dismiss asserts that the exit tax violates constitutional principles, including the Apportionment Clause and Due Process Clause. Ver’s lawyers argue that unrealized gains cannot be taxed as “income” under the Sixteenth Amendment and that the lack of clarity in tax laws regarding digital assets rendered compliance nearly impossible.
“The charges also rely on vague statutory foundations that provided no clear guidance to taxpayers like Ver,” the motion states, with Ver’s attorneys emphasizing his good-faith efforts to comply with tax laws, citing his reliance on expert appraisals and legal advice.
Government Overreach
Ver’s filing also accuses the government of overreach, including improper use of attorney-client privileged materials. According to the motion, federal agents collected confidential communications from Ver’s legal team during their investigation, violating established legal protections:
The government’s selective use of privileged materials and omission of exculpatory evidence fundamentally undermines the integrity of the indictment.
The case is set to be heard in February 2025 in the US District Court for the Central District of California unless Ver is successful in his motion. The outcome could have broader implications for how digital assets are treated under US tax law and the rights of expatriates.
