Form 1099-DA & Broker Reporting (2025)

Form 1099-DA is the new US tax form on which crypto brokers report your digital-asset sales to you and the IRS. It takes effect for the 2025 tax year — brokers report gross proceeds for 2025 transactions (the forms arriving in early 2026), with cost-basis reporting phased in for transactions from 1 January 2026. It is the biggest change to crypto tax reporting in years. This guide explains what it means for you, as general information for the 2025 tax year, US-focused, checked 10 September 2026, and not tax advice.

What Form 1099-DA is

Form 1099-DA ('DA' for digital assets) is an information return, like the 1099-B that stock brokers issue. A crypto broker uses it to report the digital-asset sales you made through them during the year, sending one copy to you and one to the IRS. Its whole purpose is to give the tax authority its own record of your disposals, so what you report can be matched against what your broker says you did. It doesn't change what you owe — the underlying rules on how crypto is taxed are the same as before — but it changes how visible your activity is.

The phased timeline

The rollout is deliberately staged. For transactions on or after 1 January 2025, custodial brokers report gross proceeds — how much you sold for — with those first 1099-DA forms issued to customers in early 2026 for the 2025 tax year. For transactions on or after 1 January 2026, brokers must also report cost basis for covered assets, so later forms will show both the proceeds and what you paid. That means for the 2025 tax year the basis box may often be blank, and it remains your job to know your own cost basis. The staggering gives brokers time to gather historical purchase data they don't always have.

Why the basis box matters

A 1099-DA that shows proceeds but not cost basis can be dangerously misleading if you don't understand it. Proceeds are not profit — your taxable gain is proceeds minus basis. If the IRS receives a form showing, say, $40,000 of sales with no basis, and you don't report your basis, it can look as though the entire $40,000 is a gain. So for 2025 sales especially, keep your own records of what each coin cost you, and reconcile the form against them. Understanding cost basis and capital gains is what stops a proceeds-only form turning into an overstated bill.

Why DeFi got carved out

A notable twist: the reporting rules originally reached toward decentralised finance, but a separate 'DeFi broker' rule was repealed. Using the Congressional Review Act, Congress voted to overturn it and the President signed the repeal into law on 10 April 2025. As a result, decentralised protocols and front-ends that don't custody your assets are not required to issue Form 1099-DA. Centralised, custodial exchanges — the ones that hold your coins and offer fiat on- and off-ramps — remain fully within the rules and will report. The practical point: don't assume that because a DeFi platform sends you no form, the activity is untaxed. It is still taxable; it's just not being reported for you, so your own records matter even more.

What to do about it

Three sensible moves. First, expect 1099-DA forms from your custodial exchanges for 2025 and check each against your own records. Second, keep your cost-basis records rigorously, since the forms won't reliably carry basis yet. Third, reconcile everything — exchange forms, on-chain DeFi activity, transfers between wallets — so your return is consistent with what the IRS receives. Crypto tax software is built to do this reconciliation and to reconcile 1099-DA figures against your transaction history. This is general information; because the rules are new and still settling, confirm the current requirements and, for anything unclear, consult a qualified tax professional.

How this compares to stock reporting

If you've ever traded shares, 1099-DA will feel familiar, because it deliberately mirrors the 1099-B that stock brokers have issued for years. Crypto reporting is essentially catching up to how traditional brokerage reporting already works: the broker tells you and the tax authority what you sold and, in time, what it cost. The main practical difference is history. Stock brokers have long held clean purchase records; crypto brokers often don't, especially for coins you transferred in from elsewhere, which is why cost-basis reporting is phased in later and why the early forms lean on gross proceeds. It also means a 1099-DA can be incomplete or imperfect in these first years in ways a mature 1099-B usually isn't — so the sensible posture is to treat the form as a useful cross-check against your own records, not as the final word.

What to do if a form looks wrong

Especially in these transition years, a 1099-DA may not match your reality — it might show proceeds with no basis, miss coins you moved in from a wallet, or reflect only part of your activity. If it looks wrong, don't ignore it and don't blindly copy it. Reconcile it against your own transaction records, work out your correct cost basis and gains, and report the accurate figures, keeping documentation of any differences in case you're asked to explain them. If a broker's form contains an outright error, contact the broker about a correction. Because the IRS receives its copy too, an unexplained mismatch between the form and your return is what draws attention — so the goal is a return that is both accurate and clearly reconciled to what was reported. When the discrepancy is large or you're unsure, a tax professional is well worth the fee here.