Chair of the Senate Finance Committee, Senator Ron Wyden, has accused Dan Morehead, founder of Pantera Capital, of evading federal taxes by relocating to Puerto Rico.
According to a letter sent on September 30, the investigation examines whether wealthy Americans are using Puerto Rico’s tax programs to cut down their US tax bills.
Wyden launched the review in January. He said Morehead’s lawyers first indicated they would work with his staff, but then stopped responding.
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Wyden wrote, “While your attorneys initially suggested to my staff you were willing to cooperate with this inquiry, they have all but disappeared”.
He added that he is concerned Morehead may have avoided more than $100 million in federal taxes on capital gains that were earned while he was still living in San Francisco.
The senator’s letter indicated that Morehead might relocate to Puerto Rico just before making hundreds of millions of dollars from selling part of his stake in Pantera. According to Wyden, Morehead then claimed that the money was free of US taxes due to his new residency.
Wyden argued that the law requires new Puerto Rican residents to continue paying US taxes on gains for ten years after moving. He said:
These are serious allegations of potential abuse of Puerto Rico tax incentives to avoid the payment of US taxes that you must immediately address.
On October 1, the Senate Finance Committee held a hearing on cryptocurrency taxation. What was the hearing about? Read the full story.
