MicroStrategy, a technology firm led by pro-Bitcoin founder Michael Saylor, has reached a $40 million settlement to resolve a lawsuit accusing Saylor of evading income tax, according to The New York Times. The attorney general for the District of Columbia finalized the settlement with Saylor and MicroStrategy, marking it as the largest recovery in the district’s history for income tax fraud. This case is the first to be filed under the district’s amended False Claims Act, which encourages whistleblowers to report tax evasion by residents concealing their residence information.
The lawsuit against Saylor and his company was filed by the District of Columbia in August 2022. It alleged that Saylor had not paid income taxes in the district for at least 10 years while residing there. The claims stated that MicroStrategy had assisted Saylor in evading over $25 million in D.C. income tax. Initially, experts estimated that Saylor could face $75 million in penalties.
As a result of the tax fraud suit, Saylor resigned from his position as CEO of MicroStrategy in August 2022, after founding the firm 33 years prior. He immediately assumed the role of executive chairman and continued to serve as chairman of the board of directors. Despite stepping down as CEO, Saylor has maintained MicroStrategy’s reputation as a Bitcoin-friendly company, regularly announcing new Bitcoin purchases on his social media account.
In March 2024, MicroStrategy made a significant Bitcoin purchase, buying 12,000 BTC through an $800 million convertible note offering. As of May 1, 2024, the company owned a total of 214,400 BTC, acquired at an average purchase price of $35,000 per BTC, with a total cost of approximately $7.5 billion.
Saylor has gained recognition as a prominent figure in the cryptocurrency community due to his substantial Bitcoin investments and active presence on social media. Although he was not an early Bitcoin adopter, his journey to becoming a billionaire through Bitcoin began in 2020 when he personally purchased 17,732 BTC for $175 million. Prior to this, Saylor had been skeptical about Bitcoin’s future and expressed concerns about its regulatory outlook.
Source: Michael Saylor
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