Two of the most senior officials leading the Internal Revenue Service’s digital asset strategy have been removed from their posts as part of a wider government downsizing campaign directed by the Department of Government Efficiency, or DOGE. The department, a new federal unit created under the Trump administration and publicly backed by Elon Musk, has taken the lead in cutting what it calls bloated and misaligned federal staffing, including at the IRS.
Seth Wilks and Raj Mukherjee, both formerly from the private crypto industry, were placed on administrative leave following orders to accept deferred resignations. While still technically employees for now, they are no longer active in their roles. This move follows months of reports that the IRS would undergo heavy restructuring, with over 20,000 employees signing similar resignation agreements in recent weeks.
Wilks and Mukherjee joined the IRS in early 2024, following careers at TaxBit and Binance.US respectively. They were assigned to build new systems for enforcing tax rules in the cryptocurrency sector. Among their key contributions was the introduction of the 1099-DA tax form, which was rolled out to help Americans report digital asset transactions more easily. They also worked on a regulatory rule requiring decentralized finance brokers to gather and share detailed user data. That rule, finalized in the final days of the Biden administration, was later repealed by Congress and formally nullified when President Trump signed a joint resolution earlier this year.
Both Wilks and Mukherjee held director-level titles, leading the agency’s efforts to manage compliance programs and coordinate with the crypto industry. Their removal signals a sharp change in direction from the previous administration’s approach. It also indicates that DOGE is not just reducing staff but shifting policy priorities within the federal tax agency.
The IRS’s ongoing staffing reduction is part of a broader effort under DOGE to roll back expansions introduced during the Biden presidency. Those expansions had added around 20,000 IRS workers to improve tax enforcement and data collection. Under the Trump administration, the focus has turned toward cutting costs and reducing the government’s involvement in financial oversight.
The departure of Wilks and Mukherjee comes at a time when the future of crypto regulation remains uncertain. Their removal, paired with the repeal of the DeFi rule, shows how quickly federal priorities can change. Critics have warned that these rapid shifts risk leaving regulatory gaps, especially in fast-moving sectors like digital assets. However, supporters of the cuts argue that agencies had grown too large and out of step with what they describe as a more efficient government model.
While both men technically remain on payroll until the end of the resignation period in September, their exit is widely seen as final. DOGE’s influence within federal agencies continues to grow, and this development adds to growing questions about how the United States will approach digital asset regulation going forward.
