Form 1099-DA was introduced by the Internal Revenue Service (IRS) in 2024, but it matters now more than ever. For the first time, brokers must report certain digital asset sales to both you and the IRS. In 2025, this means reporting gross proceeds. From 2026, certain brokers must also report cost basis.
While the new form simplifies reporting, it also introduces new responsibilities. So, what exactly is Form 1099-DA, what information does it contain, and how will it affect your crypto taxes? Let’s break it down.
Key Takeaways
- Form 1099-DA reports applicable crypto sales to the IRS, making broker-reported data part of your tax records.
- The reporting rules changed in 2025 with gross-proceeds reporting and expanded in 2026 to include cost-basis reporting for covered digital assets.
- Custodial brokers generally report, while qualifying non-custodial and DeFi platforms do not.
- You must report taxable crypto activity even without receiving Form 1099-DA.
- Reconcile proceeds, cost basis, and transfers before filing to catch discrepancies.
What is Form 1099-DA?
Form 1099-DA, Digital Asset Proceeds From Broker Transactions, is a tax information form that brokers use to report certain crypto transactions to you and the IRS. It is similar to other information returns, such as Form 1099-B, but is specifically designed for digital assets.
If you sell, exchange, or otherwise dispose of digital assets through a broker, the broker may have to issue you a Form 1099-DA and send the same information to the IRS.
However, receiving or not receiving Form 1099-DA does not determine whether you owe tax. You are still responsible for reporting your taxable digital asset income, gains, and losses on your tax return, even if a transaction does not appear on a 1099-DA.
Important Note:
For transactions in 2025, brokers generally have to report gross proceeds. For certain transactions from 2026 onward, brokers must also report cost basis. This means the IRS is receiving more information about crypto transactions directly from brokers instead of relying only on what taxpayers report themselves.
What Has Changed With Form 1099-DA?
Form 1099-DA changes what crypto brokers report to the IRS and when they report it. The rollout happens in stages:
- 2025 introduced gross-proceeds reporting
- 2026 adds cost-basis reporting for covered digital assets.
Here’s the change at a glance:
Basis | Before 2025 | 2025 | 2026 onwards |
Form used | No Form 1099-DA for digital asset transactions | Form 1099-DA | Form 1099-DA |
Gross proceeds | Investor reported proceeds based on their own records | Brokers report gross proceeds to the investor and IRS | Brokers report gross proceeds to the investor and IRS |
Cost basis | Investor tracked and calculated cost basis | Investor still tracks and calculates cost basis | Brokers report cost basis for covered digital assets |
Capital gains/losses | Investor calculated gains or losses using their records | Investor calculates gains or losses using reported proceeds and their own basis records | Investor can use broker-reported proceeds and basis to calculate gains or losses |
IRS information | IRS had no Form 1099-DA from brokers | IRS receives gross-proceeds information from brokers | IRS receives gross proceeds and cost-basis information for covered transactions |
Why Is Form 1099-DA Created by the IRS?
Crypto transactions were becoming harder for the IRS to track because investors could trade across exchanges, wallets, and other platforms. Form 1099-DA was introduced to close these reporting gaps and give the IRS better visibility into digital asset transactions. The key goals behind the new form include:
Strengthening Tax Compliance
Form 1099-DA was introduced in 2024, under the Infrastructure Investment and Jobs Act (2021), to ensure brokers report users’ crypto transactions directly to the IRS. This shift moves the responsibility from self-reporting by taxpayers to verified reporting by exchanges and other intermediaries.
Reducing Reporting Gaps
Prior to this form, many investors failed to report or miscalculated their crypto income. The new framework helps close these gaps by standardising how digital asset transactions are documented and reported.
Addressing Crypto Market Complexity
Cryptocurrency transactions often occur across multiple wallets and exchanges, making manual recordkeeping difficult. The IRS created this form to help streamline tracking and reduce errors in capital gains calculations.
Encouraging Fair Enforcement
With Form 1099-DA, the IRS can more easily identify unreported transactions or discrepancies to promote fair taxation and to discourage intentional non-compliance among investors and trading platforms.
How's It Different From Other 1099s?
While the IRS already uses several 1099 forms for disclosure of various types of income, Form 1099-DA is the first designed exclusively for reporting digital asset transactions.
The key differences between the 1099 forms are:
Aspect | Form 1099-DA | Form 1099-B | Form 1099-MISC |
Purpose | Reports proceeds from reportable digital asset broker transactions | Reports proceeds from sales of securities and certain barter transactions | Reports various types of miscellaneous income |
Asset / Income Type | Digital assets, including cryptocurrency, stablecoins, NFTs and other blockchain-based assets | Stocks, bonds, options and other securities | Examples include rents, royalties, prizes and awards |
Who Files It | Digital asset brokers | Securities brokers and barter exchanges | Businesses and other payers making reportable payments |
Proceeds | Reports gross proceeds from reportable digital asset sales | Reports proceeds from securities transactions | Reports applicable income payments |
Cost Basis | For 2026 onward, brokers must report basis for covered digital assets; basis reporting for noncovered digital assets is generally voluntary | Reports cost basis when required | Generally does not report investment cost basis |
Who Needs To Submit Form 1099-DA?
Not everyone involved in crypto transactions must file this form. The IRS limits the requirement to certain entities defined as digital asset brokers, those in a position to know the identities of the parties involved in a crypto transaction.
The IRS categorises the following as brokers that may have Form 1099-DA reporting obligations:
- Digital Asset Trading Platforms: Custodial platforms that take possession of customers’ digital assets and effect sales.
- Hosted Wallet Providers: Certain custodial wallet providers that effect sales of customers’ digital assets.
- Digital Asset Kiosks: Operators that allow customers to sell or exchange digital assets for cash, stored-value cards, or other digital assets.
- Digital Asset Payment Processors: Certain processors that facilitate digital asset payments and have actual knowledge or ordinarily would know the nature of the transaction and gross proceeds.
- Other Digital Asset Middlemen: Certain agents, dealers, and other intermediaries that effect dispositions of customers’ digital assets.
Important Note:
Simply providing hardware or software that lets users control their own private keys does not, by itself, make a business a broker. The IRS specifically excludes providers that only perform that function.
So, for Form 1099-DA, the key distinction is custodial vs. non-custodial services. Custodial brokers, such as exchanges that take possession of customers’ digital assets, generally have Form 1099-DA reporting obligations. Non-custodial providers that only give users software or hardware to control their own private keys generally do not.
The IRS had also proposed separate reporting rules for certain DeFi brokers, but Congress repealed those rules in April 2025. Therefore, DeFi platforms are not currently required to report under those repealed rules. However, users must still report their own taxable DeFi transactions.
Who Does Not Need To File Form 1099-DA?
While brokers and exchanges may have Form 1099-DA reporting obligations, not every participant in the crypto ecosystem is considered a broker. The IRS excludes certain participants that do not perform broker functions, like:
- Miners and Validators: Individuals or businesses that solely provide proof-of-work or proof-of-stake validation services are not considered brokers for these activities.
- Node Operators: Those who operate or maintain blockchain nodes without performing broker functions generally do not have Form 1099-DA reporting obligations.
- Software and Hardware Providers: Providers that only offer software or hardware that allows users to control their private keys are not considered brokers, as long as they do not perform additional broker functions.
- Staking Participants: Staking transactions are currently excluded from Form 1099-DA reporting until the IRS issues further guidance. However, this does not mean staking rewards are exempt from income tax.
IRS Rationale for Exemption
The IRS does not treat every participant in the blockchain ecosystem as a broker. Entities that only validate blockchain transactions or provide software and hardware for users to control their private keys generally do not perform the functions needed to report transactions on Form 1099-DA. Miners, validators, node operators, and software providers may support or validate blockchain activity, but they generally do not know who is making a transaction or have access to all the details needed to report it. So, the IRS specifically excludes non-custodial brokers that do not take possession of the digital assets being sold or exchanged.
What Information is Reported on Form 1099-DA?
The 1099-DA crypto form focuses on providing a detailed record of your reportable digital asset transactions. The form includes:
- Digital Asset Code: Box 1a contains the nine-character code used to identify the digital asset.
- Digital Asset Name: Box 1b identifies the name of the digital asset.
- Number of Units: Box 1c shows the number of digital asset units sold or disposed of.
- Acquisition Date: Box 1d shows when the digital asset was acquired.
- Sale or Disposition Date: Box 1e records when the digital asset was sold or otherwise disposed of.
- Proceeds: Box 1f reports the proceeds from the transaction. These can include cash, digital assets, property, or services received in exchange for the asset sold.
- Cost or Other Basis: Box 1g reports the cost or other basis when applicable. For covered digital assets, brokers generally begin reporting basis for transactions from 2026.
- Basis Reporting: Box 2 indicates whether the broker reported the basis to the IRS.
- Gain or Loss: Box 6 reports the gain or loss when applicable.
- Cash Proceeds: Box 7 indicates whether the amount reported in Box 1f consists only of cash.
- Noncovered Security: Box 9 indicates whether the digital asset is a noncovered security.
- Transfer-in Information: Boxes 12a and 12b can report the number of units transferred to the broker and the date they were transferred in.
Important note:
What you must mandatorily report depends on the type of transaction and reporting method. The IRS allows optional reporting methods for qualifying stablecoins and specified NFTs, under which some fields can be left blank.
Example
Does Form 1099-DA Reports Stablecoins And NFTs?
Yes, Form 1099-DA also covers stablecoins and NFTs if your transactions meet certain reporting thresholds set by the IRS.
Stablecoin Transactions
The IRS has special reporting rules for qualifying stablecoins. Brokers using the optional reporting method do not have to report designated stablecoin sales if the customer’s aggregate gross proceeds from those sales do not exceed $10,000 for the year. If the total exceeds $10,000, the broker must report the applicable sales.
This can apply to qualifying stablecoins such as USDC, USDT, and DAI, provided they meet the IRS definition of a qualifying stablecoin.
Example:
If you buy 10,000 USDC for $10,000 and later sell them for $10,500, you have a $500 taxable gain. You must report this gain on your tax return, whether or not your broker reports the transaction on Form 1099-DA.
NFT Transactions
NFTs (Non-Fungible Tokens) are also covered by Form 1099-DA. For specified NFTs, brokers using the optional reporting method do not have to report sales when the customer’s aggregate gross proceeds are $600 or less for the year. If the total exceeds $600, the applicable NFT sales must be reported.
Example:
If you buy an NFT for $300 and later sell it for $1,000, you have a $700 gain. You must report the transaction and any taxable gain on your tax return, even if the sale falls below the Form 1099-DA reporting threshold.
When Does Form 1099-DA Roll Out?
Form 1099-DA is being introduced in two stages. Brokers began reporting gross proceeds for digital asset transactions in 2025, while 2026 added mandatory cost-basis reporting for covered digital assets.
Tax Year | What Changes? |
Before 2025 | No Form 1099-DA reporting for digital asset broker transactions. |
2025 | Brokers must report gross proceeds from reportable digital asset transactions. Cost basis reporting is optional. |
2026 onwards | Brokers must report gross proceeds, plus cost basis for covered digital assets. Basis reporting for noncovered digital assets is voluntary. |
For taxpayers, the first Form 1099-DA statements arrived in early 2026 for 2025 transactions. Brokers were required to furnish them by February 17, 2026.
So, if you’re a crypto investor, 2025 was the year Form 1099-DA reporting began, while 2026 is the year cost-basis reporting becomes a major part of the new system.
Potential Problems with Form 1099-DA
While the IRS designed Form 1099-DA to simplify crypto tax reporting, it still comes with practical challenges that both investors and brokers should understand, like:
- Missing or Incomplete Cost Basis: Brokers may not have complete cost basis information for assets transferred into their platform or acquired before the basis-reporting rules apply. Investors must also use their own records to calculate the correct gain or loss.
- Self-Transfer and Transfer-In Confusion: Moving crypto between your own wallets is generally not a taxable sale. However, transferring assets to a broker can affect how the broker reports the asset, so keeping records of the original acquisition date and cost basis is important.
- Foreign Broker Limitations: Form 1099-DA reporting generally applies to U.S. brokers. If you use a foreign broker, you may not receive a Form 1099-DA, but you are still responsible for reporting your taxable crypto transactions.
- IRS Reporting Mismatches: The IRS can compare Form 1099-DA information with your tax return. Differences may result in an IRS notice, such as a CP2000, which allows you to review and resolve the discrepancy. A CP2000 is not itself an audit notice.
How Can KoinX Help With Crypto Tax Reporting in the USA?
Form 1099-DA gives you and the IRS a record of what your broker reported. But it may not capture your full crypto history, especially when you use multiple exchanges, wallets, or DeFi platforms. KoinX helps you reconcile that information before filing.
- Bring all transactions together: Import activity from exchanges and wallets into one unified record.
- Build an accurate cost basis: Track acquisition costs across transfers and platforms, including assets your broker may not have complete basis information for.
- Reconcile Form 1099-DA: Compare broker-reported proceeds with your transaction history to identify differences before they affect your tax return.
- Account for transactions beyond your broker: Track self-custody, DeFi, swaps, and transfers that may not appear on your 1099-DA.
- Calculate gains and losses: Use your complete transaction history to determine taxable gains and losses rather than relying solely on the numbers reported by your broker.
- Prepare US tax reports: Generate tax reports, including Form 8949, using your reconciled transaction data.
Form 1099-DA gives you one piece of your crypto tax picture. KoinX helps you reconcile it with the rest.
Conclusion
Form 1099-DA changes crypto tax reporting by giving the IRS direct information from brokers about your digital asset transactions. But it does not replace your responsibility to maintain complete records or report taxable transactions.
The best approach is to treat your 1099-DA as one source of information, not your entire tax record.
Final Takeaway:
- Don’t rely solely on your 1099-DA, as it may not capture transactions across every exchange or wallet you use.
- Keep your own transaction records, especially for transfers, self-custody, assets, etc. with incomplete basis information.
- Reconcile before filing.
- Use crypto tax software to reduce manual work. KoinX can consolidate transactions, track cost basis, reconcile broker data, and generate US tax reports.
Get started with KoinX today and make crypto tax filing simpler, faster, and error-free.
Frequently Asked Questions
When Will Brokers Begin Issuing Form 1099-DA for Crypto Transactions?
Brokers began reporting gross proceeds for reportable digital asset transactions made on or after January 1, 2025. Taxpayers received their first Form 1099-DA statements in early 2026 for 2025 transactions. For transactions in 2026 and later, brokers also have cost-basis reporting requirements for covered digital assets.
What Types of Crypto Transactions Are Reported on Form 1099-DA?
Form 1099-DA generally reports sales or other dispositions of digital assets made through brokers. This can include cryptocurrencies, stablecoins, NFTs, and other digital assets covered by the broker reporting rules. The form reports gross proceeds, while cost basis is reported for covered digital assets under the applicable 2026 rules.
What Information Is Included on Form 1099-DA?
Form 1099-DA includes
- the digital asset name and code
- number of units
- acquisition date
- disposition date
- gross proceeds
- cost basis when applicable.
It can also include information about whether the basis was reported to the IRS and other transaction details. A transaction hash and wallet address are not standard Form 1099-DA fields.
Who Is Required to Issue Form 1099-DA?
Digital asset brokers that meet the IRS definition and effect reportable sales for customers generally must file Form 1099-DA.
This can include:
- custodial trading platforms
- certain hosted wallet providers
- digital asset kiosks
- other qualifying intermediaries.
A provider that only gives users software or hardware to control their own private keys generally is not a broker.
Does Form 1099-DA Apply to DeFi Transactions?
The IRS had proposed separate broker reporting rules for certain DeFi brokers, but Congress repealed those rules in April 2025 under the Congressional Review Act. The IRS subsequently confirmed that those rules have no force or effect. This does not remove a taxpayer’s responsibility to report taxable DeFi transactions.
Will Form 1099-DA Increase the Risk of a Crypto Tax Audit?
Form 1099-DA gives the IRS more information to compare with what taxpayers report, so discrepancies may result in an IRS notice. However, a mismatch does not automatically mean an audit. For example, the IRS may send a CP2000 notice when third-party information does not match a tax return, and a CP2000 is not itself an audit notice.
Do I Still Have to Report Crypto if I Don't Receive Form 1099-DA?
Yes. Not receiving Form 1099-DA does not mean your crypto activity is not taxable.
