IRS says a cheaper, faster voluntary-disclosure programme is "extremely close", with a 120-day target and no separate track for crypto

Taxpayers who want to come clean about unreported crypto may soon pay less to do so. Jarod Koopman, who is both the IRS's chief tax compliance officer and chief of IRS Criminal Investigation, said this week at the UCLA Extension Tax Controversy Conference that the agency is "extremely close" to releasing an overhauled voluntary disclosure practice, Forbes contributor Guinevere Moore reported on Friday, October 23. Koopman was interviewed on stage by tax lawyer Sandra Brown.

The headline change is cost. Koopman said penalties would be much lower than under the current programme, though he gave no percentages or dollar figures, per Forbes. Today a civil settlement normally includes a civil fraud penalty under sections 6663 or 6651(f) of the tax code, charged on whichever year in the disclosure period owes the most, per Forbes. Speed is the other promise: the IRS is targeting a maximum of 120 days to resolve a case once the taxpayer has completed the required submission, against a year or more now. The agency is also weighing offers in compromise and instalment agreements so that people who cannot pay everything at once can still take part, and its deadline for the release is before December, per Forbes.

For crypto holders the key point is that there will be no separate digital-asset track. Koopman said digital assets will be handled under the general voluntary disclosure programme like any other taxable income, Forbes and Cointelegraph reported. Cointelegraph noted that a separate bill, the Digital Asset Tax Certainty Act, which cleared the House Ways and Means Committee in September, would create its own process for correcting past crypto violations with defined penalties.

What happens next: the revised programme is expected before the end of November; open questions, per Forbes, include whether taxpayers must attest to wilfulness and whether non-filers qualify.