Growing Interest in Offshore Digital Asset Oversight
Growing U.S. interest in tightening oversight of offshore digital assets is gaining traction in Washington. Momentum is building as a proposed rule allowing the IRS to access data on Americans’ foreign crypto accounts moves into White House review. Signaling a stronger push to align U.S. tax policy with global reporting standards, the step places cooperation with foreign regulators closer to reality.
In brief
- •U.S. regulators review a proposal that enables the IRS to access Americans’ offshore crypto account data under global CARF rules.
- •CARF would automatically share foreign crypto account details across member countries to curb cross-border tax evasion.
- •The White House says joining CARF could strengthen U.S. exchanges by making offshore crypto platforms less appealing.
- •The plan excludes DeFi reporting as the IRS prepares for CARF’s 2027 rollout, marking a major shift in crypto tax oversight.
White House: Joining CARF Could Make Offshore Crypto Platforms Less Appealing
A Treasury Department proposal outlines how the United States could join the Crypto-Asset Reporting Framework (CARF), an international system created by the OECD in 2022 to counter cross-border tax evasion. Under CARF, participating countries automatically share information on residents’ crypto holdings maintained outside their home jurisdictions.
Nations including Japan, Germany, France, Canada, Italy, the United Kingdom, Singapore, the UAE, and the Bahamas have already committed to the system.
Earlier this year, advisors to President Donald Trump urged U.S. regulators to adopt CARF. Their report argued that participation would support the domestic digital asset sector and reduce incentives for taxpayers to move crypto accounts overseas. White House officials wrote that joining the framework could strengthen U.S. exchanges by making offshore platforms less attractive for tax-driven purposes.
International Digital Asset Tax Regime Advances as U.S. Plans IRS Integration
Under the proposal, federal agencies would begin preparing the IRS to connect with CARF’s global reporting network. CARF is scheduled for worldwide rollout in 2027, offering U.S. regulators time to design reporting systems and integrate new processes into tax examination programs.
Key components of the framework include:
- •Automatic exchange of foreign crypto account data among participating countries.
- •Reporting obligations for digital asset intermediaries covered by CARF.
- •Standards for identifying account holders’ tax residency.
- •Data-sharing rules to support audits and cross-border investigations.
- •Alignment with long-standing international financial reporting practices.
White House guidance also instructed the Treasury and the IRS to avoid extending new reporting requirements to decentralized finance transactions, aiming to preserve a distinction between institutional oversight and peer-to-peer activity.
Adoption of the rule would represent the most significant update to U.S. crypto tax enforcement since Congress broadened broker-reporting requirements in 2021. With 2027 set as the global rollout date, the White House appears prepared for deeper cooperation in international crypto regulation.