The US Internal Revenue Service is preparing to lower the penalties it charges taxpayers who voluntarily report unpaid taxes, and to close those cases far faster than it does today. Jarod Koopman, the chief of IRS Criminal Investigation, laid out the overhaul at the UCLA Extension Tax Controversy Conference, according to a Forbes report flagged by CoinMarketCap on October 24, 2026. Crypto is explicitly part of the plan. The agency will run digital asset disclosures through the same channel it uses for every other kind of tax noncompliance.
A faster, cheaper path to come clean
The current voluntary disclosure program is slow and expensive by design. Koopman said cases often take more than a year to close, and the process is built for people whose failures were willful enough to risk criminal prosecution, not for those who made honest filing mistakes. The revised program aims to resolve cases within 120 days of a taxpayer finishing the required submissions.
Penalties would be, in Koopman's words, substantially lower than what the agency imposes now, though he did not attach specific figures to the plan. The IRS wants the new framework in place before December. That is a short runway for a structural change to a program that shapes how willing people are to correct years of unreported income.
The plan also widens how taxpayers can pay. Koopman pointed to installment plans and offers in compromise, the mechanism that lets someone settle a tax debt for less than the full amount owed, as options under the revised program. Lower headline penalties plus flexible payment terms together change the math for anyone weighing whether a disclosure is affordable.
Crypto rides the same rails as every other disclosure
A pointed detail is what the IRS has decided not to build: a separate disclosure track for digital assets. Koopman said the agency would handle crypto through the same voluntary disclosure procedures used for other forms of noncompliance. For holders, that means unreported trading gains, swaps, staking income, and airdrops get reconciled through one door rather than a crypto-specific carve-out.
Treating crypto as an ordinary tax matter rather than an exotic one is itself the signal. It folds digital assets into the mainstream enforcement and compliance apparatus instead of fencing them off. The read here is that the IRS wants to pull more non-filers into voluntary compliance rather than chase each case individually, and a cheaper, quicker confession is a stronger lure to come forward. That framing is analysis, not a direct quote from the agency.
The stakes for US crypto holders
For US taxpayers sitting on unreported crypto activity, the calculus of coming forward shifts if the penalty drops and the wait shrinks from a year to roughly four months. People who traded actively, earned yield, or disposed of tokens across several years may have reportable events they never filed. Under the proposed rules, settling that history would cost less and close sooner.
Anyone who routinely moves crypto, including people who spend it through crypto cards, builds up a long record of transactions that can carry tax consequences. A lower-penalty path is most useful to the holder who wants to reconcile that trail before an examiner does it for them. The voluntary route only helps if a taxpayer uses it before the agency opens its own inquiry.
Two caveats deserve weight. The changes are not final. Koopman described a program the IRS intends to roll out, not one already in effect, and the pre-December target is an aim rather than a guarantee. The program also remains built for willful noncompliance that could carry criminal exposure, so it is not a blanket amnesty for every late or sloppy return. Taxpayers with simple errors have other, lighter correction routes and would not necessarily belong in the disclosure practice at all.
The direction of travel is clear enough. Enforcement agencies have spent years building the data to match crypto activity against what taxpayers report, from exchange reporting to blockchain analytics. Offering a softer landing for those who step forward first is the other half of that strategy, and it arrives as the IRS tries to settle a backlog of cases that currently drag on for a year or more.
Overview
The IRS plans to cut penalties under its voluntary disclosure program and resolve cases within about 120 days, down from the year or more it takes now, with the new framework targeted before December. Crypto will not get a separate process. Digital asset disclosures run through the same channel as other tax matters, with installment plans and offers in compromise available. The details come from IRS Criminal Investigation chief Jarod Koopman, reported by Forbes. For US holders with unreported crypto activity, a cheaper and faster way to settle is the practical takeaway, though the program is not yet final and still targets willful noncompliance.
