The head of the U.S. Internal Revenue Service’s digital assets unit, Trish Turner, has announced her departure as new tax policies for digital assets loom on the horizon. Turner exits the IRS amidst a potentially transformative period for the agency tasked with navigating the complex waters of cryptocurrency taxation.
Navigating Uncharted Waters
Turner’s exit comes at a delicate time. The IRS is gearing up for a substantial increase in crypto-related tax filings, with new rules and forms like the 1099-DA set to debut. These forms will push crypto brokers to provide documentation to millions of investors, a move anticipated to uncover a significant number of previously undisclosed crypto transactions. “Digital assets have shifted from a niche issue to a core focus for global regulators, and I am proud to have helped lay the foundation for oversight in this fast-changing space,” Turner noted in a statement to CoinDesk.
The departure of Turner follows the exits of other key figures, Seth Wilks and Raj Mukherjee, amidst budget cuts from earlier this year. These staffing reductions have left the IRS grappling with a diminished workforce, now standing at approximately 76,000 from a peak of 113,000 three decades ago. This contraction presents a formidable challenge as the agency braces for an influx of complex crypto filings.
A Shifting Regulatory Landscape
The crypto world is watching closely. The new tax documentation requirements have long been a contentious issue, with many investors previously sidestepping clear reporting due to ambiguous guidelines. Laura Walter, founder of CryptoTaxGirl, expressed confidence in Turner’s move to the private sector, stating, “Her insights will ensure our clients receive the highest level of guidance, protection, and confidence in their filings.” Turner’s new role at CryptoTaxGirl and collaboration with the UK firm Asset Reality signals a shift from regulatory oversight to helping taxpayers navigate these evolving rules.
However, the IRS’s task is fraught with uncertainties. A rule aiming to categorize some decentralized finance (DeFi) platforms as brokers was overturned by Congress in April, leaving a regulatory gap that adds to the ambiguity faced by both the IRS and crypto investors. This decision has left some areas of the crypto sector on shaky regulatory ground, raising questions about how these platforms will be handled moving forward. For a deeper dive into the regulatory implications, see our coverage of the SEC’s latest guidance.
The Road Ahead
The upcoming months are set to be pivotal. As the IRS prepares to implement its new policies, there are concerns about whether the agency can effectively manage the anticipated deluge of crypto tax filings. “This is uncharted territory for the IRS,” one analyst pointed out, “and it’s not just about numbers; it’s about understanding a rapidly evolving market.” The crypto sector has long been a challenge for traditional financial oversight frameworks, and the IRS’s adaptation will be closely monitored. This follows a pattern of institutional adoption, which we detailed in our analysis of corporate treasury investments.
Turner’s departure and the broader changes within the IRS highlight a significant moment for digital asset regulation in the U.S. The transition from a largely unregulated environment to one of increased accountability and transparency is underway, yet fraught with complexities. As investors and brokers prepare for these changes, the question remains whether the IRS can rise to the occasion and effectively manage this new frontier in taxation.
Source
This article is based on: Head of IRS Crypto Work Exits as U.S. Tax Changes Loom For Digital Assets
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Steve Gregory is a lawyer in the United States who specializes in licensing for cryptocurrency companies and products. Steve began his career as an attorney in 2015 but made the switch to working in cryptocurrency full time shortly after joining the original team at Gemini Trust Company, an early cryptocurrency exchange based in New York City. Steve then joined CEX.io and was able to launch their regulated US-based cryptocurrency. Steve then went on to become the CEO at currency.com when he ran for four years and was able to lead currency.com to being fully acquired in 2025.