IRS Crypto Chief Joins Private Sector as Tax Rules Enter Turbulent Transition

Trish Turner, the head of the Internal Revenue Service’s (IRS) digital assets unit, has announced her departure from the agency, adding to a growing list of high-level exits amid ongoing challenges in U.S. tax administration. Turner, who took the helm in May 2024, will transition to the private sector as tax director at CryptoTaxGirl, a firm specializing in cryptocurrency-related tax guidance. She will also collaborate with the UK-based firm Asset Reality. The timing of her exit comes as the IRS prepares to enforce new digital asset reporting requirements, including the 1099-DA form, which mandates crypto brokers to report detailed transaction data to both taxpayers and the IRS starting in 2025 [1].

Turner’s resignation follows the departure of other top IRS officials, including Seth Wilks and Raj Mukherjee, both of whom left earlier in 2025 under the Trump administration’s broader efforts to reduce federal agency staffing. These departures have left the IRS in a position of uncertainty as it faces a surge in digital asset tax filings. The agency, which has experienced a significant decline in staffing over the past three decades—from approximately 113,000 in the 1990s to around 76,000 in recent years—now has the added burden of managing new and complex regulations governing the taxation of cryptocurrency transactions [1].

The new 1099-DA form, which will begin to circulate in early 2026, is expected to increase the IRS’s visibility into the cryptocurrency market. Under the new requirements, brokers will be obligated to report both the gross proceeds and cost basis for digital asset transactions. The IRS has also introduced transitional tax relief through Notices 2024-56 and 2025-33, which provide some leniency for brokers and taxpayers during the transition period. For example, penalties for non-compliance in 2025 and 2026 will be waived for brokers who are acting in good faith and working toward compliance [4].

The White House’s recent report on digital asset taxation highlighted significant gaps in existing IRS guidance and recommended legislative and regulatory changes to address these uncertainties. The report emphasized the need for a more structured tax framework for digital assets, including the reclassification of stablecoins and the clarification of how the IRS should treat staking rewards, hard forks, and airdrops. It also proposed simplifying reporting requirements for small transactions to reduce compliance burdens on taxpayers and brokers [6].

The timing of Turner’s departure is particularly sensitive given the broader legislative efforts to reform the IRS’s approach to cryptocurrency. For instance, Senator Cynthia Lummis (R-Wyo.) has introduced a bill that seeks to modernize the tax treatment of crypto by eliminating double taxation for miners and stakers and establishing a $300 de minimis threshold for tax exemption. These legislative moves suggest that the U.S. government is working toward a more coherent and enforceable tax regime for digital assets, though the transition is expected to be complex and challenging [2].

Turner’s shift to the private sector has been welcomed by her new employer, CryptoTaxGirl, which said her experience will provide clients with greater confidence and clarity in navigating the evolving tax landscape. The firm emphasized that Turner’s expertise will be critical as more taxpayers and businesses adapt to the new reporting requirements. Her move underscores the growing importance of private-sector tax guidance in an environment where regulatory clarity is still emerging [2].

As the IRS continues to grapple with staffing and budget cuts, the departure of top officials raises questions about its capacity to manage the impending influx of crypto tax filings. The agency is projected to see a significant increase in digital asset-related tax returns, particularly as more investors begin to disclose their crypto holdings. The challenge for the IRS will be balancing enforcement with the need to provide clarity in a rapidly evolving market, a task that may require additional resources and policy reforms in the coming years [1].

Source:

[1] Head of IRS Crypto Work Exits as U.S. Tax Changes Loom (https://www.coindesk.com/policy/2025/08/22/head-of-irs-crypto-work-exits-as-u-s-digital-assets-tax-changes-loom)

[2] Veteran IRS official Trish Turner steps down to join crypto tax firm (https://www.theblock.co/post/368004/veteran-irs-official-trish-turner-steps-down-to-join-crypto-tax-firm)

[3] Head of IRS Crypto Unit Trish Turner resigns (https://watcher.guru/news/head-of-irs-crypto-unit-trish-turner-resigns)

[4] IRS Relief for Digital Asset Tax Reporting: What to Know (https://scltaxservices.com/blogs/irs-relief-for-digital-asset-tax-reporting-what-to-know/)

[5] Cryptocurrency Tax Rate Guide for 2025 (https://blog.cmp.cpa/cryptocurrency-tax-rate-utah)

[6] White House report recommends changes to the taxation of digital assets (https://www.eversheds-sutherland.com/en/united-states/insights/entering-the-digital-asset-age-white-house-report-recommends-changes-to-taxation-of-digital-assets)