Crypto stock MicroStrategy (NASDAQ:MSTR) ticked higher in trading on Monday after it was announced that the company’s founder, Michael Saylor, will pay $40 million to settle a tax fraud lawsuit filed by the Attorney General (AG) in Washington D.C. Saylor has invested heavily in Bitcoin (BTC-USD).
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According to Forbes, Saylor’s net worth as of June 2 was around $4.6 billion and he had a 13% stake in the company and held 2.4 million shares of MSTR as of February.
Details of the Lawsuit
The lawsuit alleges that between 2005 and 2021, Saylor evaded over $25 million in District of Columbia income taxes by claiming residency in lower-tax states like Florida and Virginia. Furthermore, the suit claims that Saylor actually stayed in a luxury penthouse apartment in Washington.
The D.C. attorney general charged Saylor and MicroStrategy with tax evasion, alleging the company helped him avoid higher D.C. taxes by misrepresenting his residency. Additionally, MicroStrategy allegedly failed to pay required corporate taxes for employing D.C. residents.
This lawsuit was originally brought against Saylor in 2022 by former AG Karl Racine and was based on a whistleblower claim in 2021 that Saylor evaded taxes and bragged about it.
Is MSTR Stock a Good Buy?
Analysts remain bullish about MSTR stock, with a Strong Buy consensus rating based on a unanimous four Buys. Over the past year, MSTR has skyrocketed by more than 400%, and the average MSTR price target of $1,793 implies an upside potential of 11.4% from current levels.
