The Internal Revenue Service (IRS) announced on Tuesday that it has brought on board two executives from the crypto industry to assist in digital asset reporting, compliance, and enforcement efforts.
Sulolit “Raj” Mukherjee, previously holding positions at ConsenSys, Binance.US, Coinbase, and the Blockchain Association, has been hired alongside Seth Wilks, the former vice president of government relations at TaxBit, a crypto tax software firm.
IRS Commissioner Danny Werfel emphasized the importance of leveraging private sector expertise to navigate the complexities of the evolving crypto sector and ensure effective tax administration.
The IRS’s annual report for Oct. 2022 to Sept. 2023 highlighted an increase in digital asset tax investigations, targeting unreported income from various crypto-related activities.
To bolster enforcement, the IRS is finalizing new regulations requiring crypto brokers, including exchanges, to furnish transaction details of their clients to the US government. Additionally, the agency is enhancing taxpayer service, technology, and enforcement efforts, particularly in areas with compliance concerns.
Proposed regulations released in Aug. 2023 define digital asset “brokers” and mandate them to adhere to reporting guidelines akin to securities brokers. These rules, effective from Jan. 1, necessitate crypto brokers to disclose personal information on transactions exceeding $10,000 within 15 days. Despite their aim to combat tax evasion, these regulations have faced criticism for their ambiguity and compliance challenges.
