Form 1099-DA Explained: What US Crypto Investors Need to Know

Form 1099-DA is the IRS information return that US crypto brokers use to report your digital asset sales. It is the crypto equivalent of the 1099-B you receive from a stock brokerage, and it significantly increases how much the IRS knows about your crypto activity.

Who sends it

Custodial platforms that act as brokers — centralized exchanges, some hosted wallet providers, crypto ATMs and certain payment processors — must issue Form 1099-DA to customers who sold or exchanged digital assets through them. A proposed rule that would have extended reporting to decentralized finance (DeFi) front-ends was repealed by Congress in 2025, so DeFi protocols do not issue the form.

What is reported, and when

• 2025 transactions (forms issued in early 2026): brokers report gross proceeds from sales and exchanges. Cost basis reporting was not required for this first year.
• 2026 transactions onward: brokers must also report cost basis for "covered" assets — generally those acquired on or after 1 January 2026 in an account with the same broker.

Assets bought before 2026, or transferred in from another platform, are usually "noncovered". The form may show proceeds with no cost basis for those sales.

Why your 1099-DA may not match your gains

This is the most important point. A 1099-DA can look alarming because:

1. Missing cost basis. If basis is blank, the form may appear to show your entire proceeds as gain.
2. Transfers between platforms. Coins moved from one exchange to another lose their basis history on the receiving platform.
3. Different matching. The broker's default method (often FIFO) may differ from the lots you identified.

You are responsible for reporting the correct cost basis on Form 8949, even if the 1099-DA shows none. Use your own records or crypto tax software to fill the gaps.

How to reconcile

1. Collect every 1099-DA you received.
2. Export complete transaction histories from each platform and wallet.
3. Match each reported sale to the lot that was sold, using the correct basis.
4. On Form 8949, report proceeds as shown on the 1099-DA, enter your actual basis, and use the appropriate box and adjustment codes where your basis differs.
5. Keep documentation that supports the basis you reported.

Small transactions

Brokers have de minimis rules for some qualifying stablecoin sales and certain small payment transactions, which may be reported in aggregate or not at all. Even if a transaction is not reported to you, any gain is still taxable.

What this means for investors

The IRS now receives data that makes it much easier to identify unreported crypto sales. Combined with the digital asset question on Form 1040, the safest approach is to keep complete records and report every disposal accurately.

Estimate your liability

Once you know your proceeds and correct basis, the crypto tax calculator estimates federal tax using 2026 brackets. For detailed filing, consult IRS instructions for Form 8949 or a tax professional.

CryptoMathly provides educational estimates only and is not financial, investment or tax advice. Crypto assets are volatile and you can lose money. Always verify figures with a qualified professional.