As a non-US human,i just want to ask that how exactly do these people rake up such liabilities. By natural law, any tax liability can only arise from an actual gain from an investment. So how do they go from setting up and investment that is worth "1 Million in taxes" and then going back to a stage where they supposedly withdraw 19k per month from crypto account to fund themselves.
That kind of financial mismanagement sounds kindda insane.
The liability stems from 2017. They obviously sold a lot of cryptocurrency that year to have incurred a $1.1 million tax bill. They may have lost a significant amount in early 2018 -- after the market crashed -- and opted not to pay their 2017 taxes, expecting that the IRS would approve a long term payment plan. In the meantime, they probably used their remaining capital to reinvest -- which is likely why they are sitting on $7 million worth of cryptocurrency now. They may be waiting until they can liquidate at long term capital gain rates rather than short term rates.
They essentially used the IRS as a backer for their investments. Now the IRS wants their money. They'll get it too. Legally, the couple has no legs to stand on. The IRS can approve or deny payment plans at their discretion. If a taxpayer doesn't pay on time and the IRS doesn't approve a payment plan,
they can put a levy on the taxpayer's assets:
An IRS levy permits the legal seizure of your property to satisfy a tax debt. It can garnish wages, take money in your bank or other financial account, seize and sell your vehicle(s), real estate and other personal property.
Personal property includes digital currency.
I hate the IRS but I wouldn't mess with them, either. Good luck to these people.