Form 1099-DA arrives for crypto reporting in 2026
Millions of U.S. crypto investors will see Form 1099-DA for the first time in the 2026 filing season. The form covers 2025 digital asset activity on U.S. custodial platforms. It standardizes broker reporting, similar to Form 1099-B. It also creates gaps that practitioners must manage from day one.
The Law in Play
Congress directed broker reporting for digital assets under §6045 and related regulations.
The IRS implemented this framework through final broker rules and transition guidance. The core question is how much activity brokers must report versus what remains the taxpayer’s responsibility. The government favors standardized reporting, while taxpayers often transact across systems that brokers cannot see.
What Form 1099-DA Reports
Form 1099-DA reports dispositions on U.S. custodial trading platforms.
It provides gross proceeds for sales and exchanges. For 2025, all dispositions are non-covered. Brokers do not report cost basis to the IRS for any 2025 activity.
Some brokers may show a basis on substitute statements. That data is optional and may be incomplete. It should not be treated as authoritative without reconciliation.
What Form 1099-DA Does Not Report
Several categories of taxable activity are excluded or partially excluded.
Custodial platform activity not reported includes:
Certain stablecoin and specified NFT transactions are under optional methods.
Wrapping, lending, and similar transactions are excluded under Notice 2024-57.
Payments to third parties where the broker only records a withdrawal.
Activity entirely outside U.S. custodial brokers is also excluded. This includes self-custody wallets, DeFi protocols, decentralized NFT markets, and foreign exchanges. These transactions still affect tax liability. They also affect the cost basis for assets later sold on U.S. platforms.
Why the First Year Is Harder
For 2025, broker reporting covers proceeds only. Taxpayers must supply the complete cost basis from their own records. That requires tracking acquisitions across years, platforms, and wallets.
In 2026, cost basis reporting begins for covered assets. Covered status applies only to assets acquired on or after Jan. 1, 2026. The asset must remain in the same custodial account until disposition.
Transfers break covered status. Digital asset brokers are not required to provide transfer statements. As a result, the basis often does not follow the asset between platforms.
Timeline
August 2023: Treasury finalized regulations for digital asset brokers.
December 2024: The IRS issued Notice 2024-57, delaying reporting for certain transactions.
Calendar year 2025: Brokers track dispositions without cost basis reporting.
Early 2026: First Forms 1099-DA issued to taxpayers and the IRS.
Present: Practitioners prepare for first-season reconciliation.
The Larger Story
Form 1099-DA shifts crypto compliance toward third-party reporting.
But the system remains fragmented because activity spans custodial and noncustodial environments. The result is partial visibility rather than full transaction capture.
This mirrors earlier transitions with securities reporting. Early years rely heavily on taxpayer records. Over time, reporting improves but never replaces recordkeeping.
What It Means in Practice
Inventory every platform, wallet, and exchange used in 2025.
Collect all Forms 1099-DA from U.S. custodial brokers.
Separately track self-custody, DeFi, NFT, and foreign exchange activity.
Reconcile reported proceeds to full transaction histories.
Preserve cost basis continuity across transfers and years.
Next Steps
The immediate task is building repeatable reconciliation workflows.
Practitioners should standardize how broker data is matched to client records. That foundation will matter more as covered assets enter the system in later years.
One More Thing
Form 1099-DA is a reporting anchor, not a complete map, and practitioners must fill the gaps.