Form 1099-DA Complete Guide: What Crypto Investors Need to Know in 2026

What Is Form 1099-DA?

If you sold, traded, or disposed of cryptocurrency during 2025, there is a good chance you received a new tax form this year: Form 1099-DA (Digital Asset Proceeds from Broker Transactions). This is the IRS's first dedicated reporting form for cryptocurrency, and it applies to the 2025 tax year — meaning exchanges began issuing it in early 2026.

Before 1099-DA existed, crypto reporting was inconsistent. Some exchanges issued 1099-Ks (typically for gross payment volume, not gains), others issued 1099-Bs, and many issued nothing at all. The IRS finalized the broker reporting rules under the Infrastructure Investment and Jobs Act of 2021, and 1099-DA is the result. It standardizes how digital asset brokers report your transaction proceeds to both you and the IRS.

Here is the key thing to understand: the IRS now receives a copy of your 1099-DA. This is not optional reporting. If Coinbase, Kraken, or Gemini sent you a 1099-DA, they also sent one to the IRS. Your tax return needs to match — or you will hear from them.

What Information Does 1099-DA Include?

Form 1099-DA reports the following for each disposition (sale, trade, or exchange) of a digital asset:

• Gross proceeds — the total amount you received from the sale, in USD
• Date of sale or disposition — when the transaction occurred
• Digital asset description — the name or ticker of the asset sold (e.g., BTC, ETH)
• Transaction ID — the blockchain or internal transaction hash
• Cost basis — what you originally paid for the asset (but see below)
• Date acquired — when you originally obtained the asset
• Gain or loss — the calculated difference between proceeds and cost basis

On paper, this looks comprehensive. In practice, there is a serious problem with cost basis that affects the vast majority of crypto taxpayers.

Why Your 1099-DA Cost Basis Is Probably Blank or Wrong

This is the single most important thing to understand about Form 1099-DA in 2026: for the 2025 tax year, exchanges are only required to report gross proceeds — not cost basis. The IRS phased in the reporting requirements, and full cost basis reporting does not become mandatory until the 2026 tax year (filed in 2027).

What this means for you right now:

• The cost basis field on your 1099-DA may be blank, marked as "N/A," or show $0.00
• Some exchanges may voluntarily report cost basis, but they are not required to and many do not
• Even when cost basis IS reported, it is often wrong — because the exchange only knows about transactions that happened on their platform

Consider a common scenario: you bought 1 ETH on Coinbase in 2022 for $1,200, transferred it to a self-custody wallet, then sent it to Kraken and sold it in 2025 for $3,500. Kraken's 1099-DA will show $3,500 in proceeds, but it has no idea what you originally paid for that ETH. The cost basis field will be blank. If you file your taxes without adding the correct $1,200 cost basis, the IRS may treat your entire $3,500 in proceeds as taxable gain — instead of the actual $2,300 gain.

This is not a hypothetical. It is happening to millions of crypto holders right now, and it is the number one reason people overpay on their crypto taxes.

Why Exchanges Cannot Track Your Full Cost Basis

Cryptocurrency is designed to move freely between wallets and platforms. You might buy on Coinbase, stake on Lido, trade on Uniswap, bridge to another chain, and eventually sell on Kraken — all with the same underlying asset. No single exchange has visibility into this full history. They can only report what they know, which is limited to transactions that occurred on their platform.

This is fundamentally different from traditional brokerage accounts, where your shares of Apple stock stay at Fidelity from purchase to sale. Crypto's portability is a feature, but it creates a tax reporting nightmare that only you (or your tax software) can solve.

How to Reconcile Your 1099-DA with Form 8949

Even though the IRS receives your 1099-DA, you still report your crypto gains and losses on Form 8949 (Sales and Other Dispositions of Capital Assets), which flows into Schedule D of your tax return. Here is the reconciliation process:

Step 1: Gather All Your 1099-DAs

Collect 1099-DA forms from every exchange where you sold or traded crypto in 2025. Check your exchange accounts and email — some platforms only make these available for download in their tax center, rather than mailing them.

Step 2: Compare Against Your Own Records

For each transaction on your 1099-DA, verify the proceeds amount and check whether cost basis is reported. If it is reported, verify it against your own records. If it is blank or wrong, you need to determine the correct cost basis yourself.

Step 3: Fill in Missing Cost Basis

This is where it gets difficult. You need to trace each asset back to its original acquisition — which may have been a purchase, a reward, an airdrop, a swap, or a transfer from another wallet. Your cost basis is the fair market value at the time you acquired the asset, plus any transaction fees paid.

For active traders with hundreds or thousands of transactions across multiple wallets and chains, doing this manually is essentially impossible. This is exactly the problem that Blockchain Smart Tax was built to solve — more on that below.

Step 4: Report on Form 8949 with the Correct Basis Code

When filling out Form 8949, you will use different "basis reported" codes depending on your situation:

• Box A: Short-term transactions where cost basis WAS reported to the IRS on 1099-DA
• Box B: Short-term transactions where cost basis was NOT reported to the IRS
• Box D: Long-term transactions where cost basis WAS reported to the IRS on 1099-DA
• Box E: Long-term transactions where cost basis was NOT reported to the IRS

For the 2025 tax year, most of your crypto transactions will fall into Box B or Box E, since most exchanges are not reporting cost basis yet. When the cost basis on your 1099-DA is blank or incorrect, use column (f) adjustment codes on Form 8949 to explain the discrepancy — typically code "B" for incorrect cost basis.

What Happens If the IRS Gets a 1099-DA and You Do Not Report

This is where things get serious. The IRS's automated matching system (called the Automated Underreporter program, or AUR) cross-references every 1099 form it receives against what taxpayers report on their returns. If the IRS has a 1099-DA showing you received $50,000 in crypto proceeds and you did not report anything, you will receive a CP2000 notice — an IRS proposal to adjust your return.

The consequences escalate:

• CP2000 notice: The IRS assumes your cost basis is $0 (since none was reported) and calculates tax on the full proceeds amount. You owe the difference plus interest.
• Accuracy-related penalty: 20% of the underpayment, applied if the IRS determines your underreporting was due to negligence or substantial understatement of income.
• Failure to file penalty: If you did not file at all, 5% of unpaid taxes per month, up to 25%.
• Criminal penalties: In extreme cases of willful evasion, the IRS can pursue criminal charges with penalties up to $250,000 and 5 years in prison.

The IRS has made crypto enforcement a stated priority. The question on the front page of Form 1040 — "At any time during the tax year, did you receive, sell, exchange, or otherwise dispose of any digital asset?" — signals how seriously they are treating this. Do not ignore your 1099-DA.

Which Exchanges Issue Form 1099-DA?

For the 2025 tax year, the following major exchanges are issuing Form 1099-DA to U.S. customers:

• Coinbase — Issues 1099-DA for all dispositions. Available in their tax center by February.
• Kraken — Issues 1099-DA. Previously issued 1099-MISCs for staking rewards; now consolidated.
• Gemini — Issues 1099-DA with transaction-level detail.
• Crypto.com — Issues 1099-DA for U.S. users above reporting thresholds.
• Robinhood — Issues consolidated 1099 that now includes 1099-DA section for crypto.
• PayPal / Venmo — Issues 1099-DA for crypto sold through their platforms.
• Cash App — Issues 1099-DA for Bitcoin sales.

Note that decentralized exchanges (DEXs) like Uniswap, SushiSwap, and Jupiter do not issue 1099-DAs. Neither do self-custody wallets like MetaMask or Phantom. Transactions on these platforms are still taxable — you are responsible for tracking and reporting them yourself. The IRS has proposed separate rules for DeFi broker reporting, but those have not taken effect yet.

How Blockchain Smart Tax Handles 1099-DA Reconciliation

Manually reconciling your 1099-DA across multiple exchanges and wallets is one of the most time-consuming parts of crypto tax filing. Blockchain Smart Tax automates this entire process:

• Automatic transaction import: Connect your wallets and exchange accounts. We pull your complete transaction history directly from the blockchain across 60+ chains — not just what the exchange reports, but everything.
• Full cost basis tracking: We trace every asset from acquisition to disposition, across transfers between wallets, DeFi interactions, bridges, and swaps. When your 1099-DA shows blank cost basis, we fill it in correctly.
• 1099-DA matching: Our reconciliation engine matches your 1099-DA entries against your actual on-chain history, flags discrepancies, and generates Form 8949 with the correct adjustment codes.
• All cost basis methods supported: FIFO, LIFO, HIFO, Specific Identification, and average cost (for non-US jurisdictions) — all included on every plan at no extra charge.
• Cross-wallet transfers: When you move crypto between your own wallets, we correctly identify these as non-taxable transfers and carry the original cost basis forward — something no single exchange can do.

If you are staring at a 1099-DA with blank cost basis fields and are not sure what to do, start your free account and import your wallets. You will see your complete tax picture in minutes, not days.

Common Mistakes People Make with 1099-DA

After helping thousands of users reconcile their crypto taxes, these are the most frequent 1099-DA mistakes we see:

1. Reporting Proceeds as Gain

If your 1099-DA shows $10,000 in proceeds and no cost basis, some people enter $10,000 as their gain on Form 8949. But proceeds are not gain — gain is proceeds minus cost basis. If you paid $7,000 for that crypto, your gain is only $3,000. Always calculate and report the correct cost basis, even if the 1099-DA does not include it.

2. Ignoring the Form Entirely

Some people assume that if the cost basis is blank, the form is incomplete and can be ignored. It cannot. The IRS has the proceeds figure, and they expect you to report it. Ignoring a 1099-DA is one of the fastest ways to trigger an automated audit notice.

3. Double-Reporting Transfers as Sales

Moving crypto from Coinbase to your Ledger is not a taxable event. But some people, confused by exchange withdrawal records, report these transfers as dispositions. This creates phantom gains that you do not actually owe tax on. A proper crypto tax tool will identify wallet-to-wallet transfers and exclude them from your taxable events.

4. Using the Wrong Holding Period

The difference between short-term and long-term capital gains can mean a tax rate difference of 15-20 percentage points. If you transferred crypto between exchanges before selling, the acquisition date is when you originally bought the asset — not when it arrived at the selling exchange. Getting this wrong can cost you thousands of dollars.

5. Forgetting DeFi and DEX Transactions

Your 1099-DA only covers centralized exchange transactions. If you also traded on Uniswap, provided liquidity on Aave, or swapped tokens on Jupiter, those taxable events will not appear on any 1099-DA — but they are still taxable and must be reported on Form 8949. For a full overview of what is taxable, see our crypto tax basics guide.

What to Do Right Now

If you have received a 1099-DA and are not sure how to handle it, here is your action plan:

• Do not panic. Missing cost basis is normal for 2025. It is not an error on your part.
• Do not ignore it. The IRS has the same form you do. Report your transactions on Form 8949.
• Gather your full history. You need records from every exchange and wallet you used, not just the one that sent the 1099-DA.
• Use proper crypto tax software. Blockchain Smart Tax imports your on-chain history, fills in missing cost basis, and generates IRS-ready Form 8949 — correctly reconciled against your 1099-DA data.
• File on time. The deadline for 2025 tax returns is April 15, 2026. If you need more time, file an extension (Form 4868), but remember that an extension to file is not an extension to pay.

The era of unreported crypto is over. The 1099-DA makes that clear. But having a 1099-DA with blank cost basis does not mean you owe tax on the full proceeds — it means you need the right tools to prove what you actually owe. That is exactly what we built Blockchain Smart Tax to do.

Handle 1099-Da Reconciliation Automatically

Blockchain Smart Tax automates the hard parts of 1099-DA reconciliation — connecting to 550+ blockchains, classifying every transaction, enforcing per-wallet cost basis tracking (as required by the IRS), and generating the forms you need to file.

How we compare to other crypto tax platforms:

• Koinly ($49+/year) — established platform with strong exchange integrations and a large user community
• CoinTracker ($59+/year) — polished interface with strong Ethereum and exchange support
• CoinLedger ($49+/year) — competitive pricing with good NFT and exchange support
• Blockchain Smart Tax (from $25/year) — all cost basis methods free on every plan, automatic wallet discovery across 550+ chains, spam filtering, free during beta with 10,000 transactions

Start your free import — 10,000 transactions included during beta →