White House Revises Rule on IRS Access to Offshore Crypto Data

Will the White House proposal give the IRS broader access to offshore crypto data as agencies push for stricter tax oversight?

The White House is exploring a proposed rule that would give the Internal Revenue Service access to data on U.S. taxpayers’ digital asset activities through foreign platforms.

The proposal reaches the Office of Information and Regulatory Affairs on Friday. The agency, under the broader Office of Management and Budget, reviews federal regulations to ensure they are consistent with presidential policy objectives.

The move follows a detailed report on digital assets published earlier this year, in which the government addressed gaps in crypto oversight and tax compliance.

One of the report’s recommendations urged the IRS and Treasury Department to consider rules that align with the Crypto-Asset Reporting Framework, an international standard designed to improve tax transparency.

Under this framework, digital asset service providers would be required to share transaction information with regulators to help authorities identify offshore activity.

The White House argued in its report that adopting the framework would reduce incentives for U.S. taxpayers to move assets to offshore exchanges and could support healthier activity in the domestic market. It also said such alignment would help prevent the U.S. from falling behind jurisdictions that already have similar reporting standards.

However, the report notes that comprehensive rules should prevent additional reporting requirements from being imposed on decentralized financial transactions, indicating that DeFi activities should remain outside the scope of the proposal.