This is true, but unless one feels that he/she should not need to pay taxes, it's reasonable for the IRS to demand records from a firm operating in the US that would allow for very quick and efficient tax enforcement. They already do it with banks, etc.
While I'd like to see much lower Federal taxes and no more expensive wars of aggression, I don't think there is a principled reason to oppose the IRS doing this very basic audit of tax compliance. After all, the ease of doing an audit is a major feature of a public block chain, and KYC requirements were not introduced by accident.
Early adopters of BTC who still use it (or aspire to use it) in an economy that still relies heavily on fiat currencies need to expect this sort of thing to happen. Yes, it's heavy handed but so is everything about the IRS and our massive Federal war/propaganda machine.
I suspect Satoshi would have randomized BTC transactions to make the audit impossible but for his anticipation of this transitional phase when fiat regulators have the power to compel firms to disclose non-cryptographically-secured information and link it with KYC data.
What can we do? Let's hope that enough of the useful organizational structures found in fiat currencies come to exist for crypto-currencies.
Things like insurance markets, dispute resolution, consumer credit, etc. To date most of the benefits of BTC have been related to the ease of sending and receiving funds securely, but there are many more benefits to come as new institutions and mechanisms for cooperation come to exist via blockchain technology that require less trust and authority and less overhead.