White House Proposes Taxation of Americans’ Foreign Crypto Accounts

• White House review signals tighter oversight of foreign crypto accounts through CARF alignment.
• Proposed rules push Americans to report overseas digital asset gains with sharper transparency.

The White House is currently reviewing a proposal from the Internal Revenue Service (IRS) that would allow the United States to adopt the international Crypto-Asset Reporting Framework (CARF).

If approved, the proposal would enable the tax agency to collect data on Americans holding digital assets in foreign accounts.

The IRS submitted the “Broker Digital Transaction Reporting” rule to the White House on Friday, suggesting a shift toward closer alignment with international tax transparency standards. The rule aims to strengthen enforcement by requiring Americans to report capital gains from crypto holdings on platforms based outside the U.S.

Although the proposal was not labeled as “economically significant,” the change would raise the level of detail required in tax filings and make it harder to avoid capital gains tax through foreign exchanges. The proposal follows a broader digital asset strategy report issued earlier this year, which recommended stricter reporting standards.

Global Push for Unified Crypto Tax Rules

CARF, an initiative of the Organization of Economic Cooperation and Development established in 2022, aims at assisting governments across the world in identifying tax evasion in the cryptocurrency markets. The framework facilitates the exchange of user information on digital transactions across different nations.

The United States is among 23 countries that have committed to adopting this standard by 2028. Another 50 countries, including Italy, the United Kingdom, Mexico, and Indonesia, plan to adopt this setup by 2027. This cooperation stems from rising global pressure on tax reporting tied to digital currencies.

A statement in the White House’s digital asset report said, 

It further stated that this move will facilitate the growth of the digital assets sector locally as well as address issues regarding the lack of reporting mechanisms relative to other nations.

IRS Preparing for Deeper Crypto Tracking

Cryptocurrency’s ability to easily cross borders and operate independently of the conventional banking system made it even more challenging for the tax agencies to monitor. Self-custody wallets and pseudonymous transactions have remained at the center of issues raised by the agencies.

By joining the CARF, the United States will gain access to shared data from other member countries. This will give the IRS a clearer view of American assets held overseas. The step is seen as an effort to close gaps and curb offshore tax evasion linked to digital currencies.

The proposed regulation still awaits final approval, but it points toward a broader push for international cooperation. The IRS and the Treasury appear to be preparing for a future where crypto data is no longer scattered or hidden behind external systems.