Coinbase User Has No Right To Block IRS Access To Crypto Records, Says US Govt.

According to the latest filing in the Harper Vs IRS case, the US government argued that the individual has no right to block the IRS from accessing his crypto records. While the user alleged that the IRS unlawfully accessed his private financial information, the government is urging the Supreme Court to rule in favor of the IRS.

US Government Sides with IRS in Coinbase User’s Privacy Case

US Solicitor General D. John Sauer argued in a May 30 filing that James Harper, a Coinbase user, lacks Fourth Amendment protection for his financial records stored with the exchange. The government claims Harper voluntarily shared his data with Coinbase, and the IRS followed proper procedures, like judicially approved summons, to obtain it. The filing also referenced Coinbase’s own privacy policy, which notified users that their information might be disclosed to law enforcement agencies.

“The IRS may ‘examine any books, papers, records, or other data which may be relevant’ to a tax inquiry and demand the production of the same,” the filing noted, highlighting the authority’s rights. The US government is backing the IRS’s authority to obtain crypto transaction records, arguing that the agency followed proper procedures and has the right to examine relevant records in tax inquiries.

Harper vs. IRS: A Battle for Crypto Privacy

James Harper, a Coinbase user, sued the IRS in 2020, alleging that the agency’s actions amounted to an unconstitutional search of his personal records. Specifically, Harper claimed that the IRS violated his Fourth Amendment rights when it obtained his financial records from Coinbase through a “John Doe” summons. The IRS had issued this summons in 2016 as part of an investigation into widespread tax underreporting on cryptocurrency gains.

However, lower courts ruled against Harper, determining that the records held by Coinbase are considered business documents, not his personal private papers, and therefore the IRS’s actions were lawful. Reflecting on the ruling, the US government, in its recent filing, stated, “To the extent petitioner made those arguments below, the court of appeals correctly rejected them as both foreclosed by this Court’s precedent and meritless.”

Coinbase Backs Harper

After the court ruling, Coinbase joined the case, supporting James Harper’s position and arguing that the government’s actions raised important privacy issues. In April 2025, Coinbase filed an amicus brief, arguing that the court must “protect Americans’ privacy interests in digital information stored by third-party service providers.”

Further claiming that Harper’s case has wider privacy implications, Coinbase argued, “The court should intervene to clarify that the third-party doctrine does not allow the IRS to conduct dragnet searches.”