Your First Form 1099-DA

Key Takeaways

Form 1099-DA is the first IRS information return for digital asset transactions, issued for Tax Year 2025. It reports what you sold and for how much, but in most cases, it does not report what you paid.
Cost basis reporting is voluntary for TY2025. Mandatory basis reporting begins January 1, 2026 for covered digital assets. If your form shows blank or $0 basis, you must reconstruct it yourself or risk overpaying on phantom gains.
All digital asset transactions go on Form 8949 boxes G/H/I (short-term) and J/K/L (long-term), not boxes A-F. Box H and Box K are the most commonly used this year because brokers are not widely reporting basis.
DeFi, staking, and airdrop income will not appear on your 1099-DA but remains fully taxable under current IRS guidance. Your return should include activity beyond what the form covers.
New Jersey filers face additional exposure because NJ taxes all crypto gains as ordinary income with no long-term preferential rate and no capital loss carryforward.

If you traded cryptocurrency on a centralized exchange in 2025, there is a new tax form sitting in your inbox right now, and it is one you need to understand. Form 1099-DA is the IRS's first standardized information return for digital asset transactions, and it changes how crypto gets reported to the federal government.

The problem is that most investors have never seen this form before, many exchanges delivered them late or not at all, and the data on them is incomplete by design. Brokers are reporting what you sold and for how much. In most cases, they are not reporting what you paid for it. That gap is where costly filing mistakes happen.

I have been reviewing 1099-DAs in my practice since they started arriving, and the pattern is consistent: proceeds reported, basis missing, and clients confused about what to do next. This is what you need to understand before you file.

What Is Form 1099-DA?

Form 1099-DA is the IRS information return that digital asset brokers use to report cryptocurrency transactions to both the taxpayer and the IRS. It is the crypto equivalent of Form 1099-B, which stockbrokers have used for decades. The "DA" stands for Digital Assets. The form was created under the Infrastructure Investment and Jobs Act of 2021, which expanded the IRS definition of "broker" to include digital asset exchanges, and Tax Year 2025 is the first year it is being issued.

The IRS published Fact Sheet FS-2025-06 on September 25, 2025 to help taxpayers prepare for the new form. This guide goes deeper into the practical filing issues I am seeing in client files right now.

Who Gets a Form 1099-DA?

Form 1099-DA covers broker-effected activity on reporting platforms. In practice, this means custodial exchanges like Coinbase, Kraken, and Gemini, along with certain payment processors and crypto kiosks. Coverage varies by platform and transaction type, so gaps are expected even within custodial platforms.

What 1099-DA Does Not Cover

The following activity will generally not appear on any Form 1099-DA for TY2025:

Pure on-chain DeFi activity. The DeFi broker reporting rule (T.D. 10021) was repealed by Congress via the Congressional Review Act (H.J.Res.25, signed April 10, 2025) and has no legal force. This repeal targeted the non-custodial DeFi "trading front-end services" rule specifically. It does not eliminate 1099-DA reporting by custodial brokers. If you used a decentralized exchange, liquidity pool, or lending protocol without a reporting broker intermediary, that activity generally will not appear on a 1099-DA. Your tax obligations on that activity still exist. The IRS just is not receiving a form for it.

Staking and earn rewards. Brokers are not required to report certain staking-related transaction structures on Form 1099-DA for TY2025 under IRS Notice 2024-57. Staking rewards themselves are not reported on 1099-DA regardless. You may receive a 1099-MISC, 1099-INT, or another statement from your exchange for staking income. If no form was issued, the income is still reportable under Rev. Rul. 2023-14.

Airdrops, mining income, and hard fork proceeds. These are taxable events not captured by the 1099-DA reporting framework.

I cover all five of the most common unreported crypto tax events in detail here: The 5 Crypto Tax Events Your 1099-DA Won't Report (But the IRS Still Expects You To).

When Were 1099-DAs Due, and Why Yours Might Be Late

Recipient copies of Form 1099-DA were due by February 17, 2026, the same furnishing deadline category as Form 1099-B under the IRS general instructions. This is the first year exchanges have had to produce these forms at scale, and the reality on the ground is that many platforms missed that deadline or are still issuing corrections.

IRS Notice 2024-56 provides penalty and backup withholding relief for brokers making good-faith efforts to file and furnish correctly for TY2025. Notice 2025-33 subsequently extended and modified that relief, pushing backup withholding deferral through calendar year 2026 and extending additional relief into 2027. The IRS anticipated that brokers would struggle in year one and built in a grace period. Late and corrected forms are a real possibility. Do not wait for corrections to start reconciling your records.

How to Read Your Form 1099-DA: The Key Fields

Understanding each field on your 1099-DA is essential for accurate filing. Here are the fields that matter most:

Box 1f: Gross Proceeds

This is the number the IRS will receive. It reflects gross proceeds reduced by allocable transaction fees, commissions, and other allocable costs under Reg. §1.6045-1. For crypto-to-crypto swaps, it may also reflect the fair market value of the non-cash consideration received. For NFT creators and minters where the broker used optional aggregate reporting, proceeds appear in Box 11c rather than Box 1f.

Box 1g: Cost or Other Basis

For most TY2025 transactions, this will be blank. The IRS 1099-DA instructions explicitly state that brokers are not required to report basis for sales effected in 2025. Some brokers may voluntarily report basis for assets acquired and sold on their platform. If yours did, verify the number before relying on it. If you see $0 and you paid for the asset, that is a broker error. The instructions direct brokers to enter $0 only when the basis is actually zero.

Box 1d: Date Acquired

May be blank or unreliable, especially for transferred-in assets. The IRS allows this field to be blank for several valid reasons including unknown acquisition date, assets acquired on multiple dates, noncovered status, or optional reporting methods.

Boxes 12a and 12b: Transfer Information

These flag transferred-in assets. If either is populated, the receiving platform likely does not have your original purchase price or date. In my experience, these lines are the number one source of basis errors this season. Treat any line with 12a or 12b activity as high risk and verify everything using your own records.

The "Applicable Checkbox on Form 8949" Field

This one-letter code tells you which Form 8949 box to use:

Code Y is the most common code on TY2025 1099-DAs. Per the 1099-DA instructions, Code Y signals that the broker cannot determine whether you should check Box H or Box K because it is not reporting basis information. The instructions state directly: brokers not reporting basis are directed to use Code Y. You must determine short-term vs. long-term from your own records and use Box H (short-term) or Box K (long-term) on Form 8949.

Code H or K means the broker indicated your holding period but did not report basis. Use the corresponding Form 8949 box and supply your own basis in Column (e).

Code G or J means basis was reported to the IRS. Use the corresponding box and still verify accuracy before filing.

For a detailed breakdown of every applicable code and how they interact with Form 8949 adjustments, including the correct use of Adjustment Code B, Code E, and the Box 1f fee trap, see my comprehensive guide: The 1099-DA $0 Basis Trap: What Crypto Investors and CPAs Need to Know for Tax Year 2025.

Why Blank Basis Is the Biggest Risk on Your 2025 Return

A blank or $0 cost basis on your 1099-DA does not mean you paid $0 for the asset. It means your broker did not or could not report what you paid. If you file without entering your actual cost, the IRS will calculate your gain as if your basis was zero, and you will overpay on every dollar of your original investment.

What the Phantom Gain Trap Looks Like

You sold BTC for $12,000. Your 1099-DA shows $12,000 in proceeds and a blank basis. Your actual cost was $9,000, making your real gain $3,000. If you file without entering that cost, you voluntarily overpay on $9,000 of phantom gain. For a New Jersey filer in the top bracket, the combined federal and state rate on short-term gains can exceed 51%. That is over $4,500 in unnecessary tax on a single transaction.

When you enter your reconstructed $9,000 basis in Column (e) of Form 8949, you are filling in information the broker did not provide, not contradicting a reported figure. Keep solid documentation. The IRS may request substantiation, and your records are your defense.

For a step-by-step walkthrough of how to reconstruct basis and fix every type of 1099-DA error: 1099-DA Shows the Wrong Number. Now What? How to Fix Cost Basis Errors on Your 2025 Crypto Tax Return.

Which Form 8949 Box Do I Use for Crypto?

All digital asset transactions go on Form 8949 in boxes G/H/I (short-term) and J/K/L (long-term). The IRS Form 8949 instructions are categorical on this point: crypto does not use Box C or F. Here is the routing:

Box G: Short-term, 1099-DA received, basis WAS reported to the IRS

Box H: Short-term, 1099-DA received, basis NOT reported (most common in 2025)

Box I: Short-term, digital asset transaction not reported on any 1099-DA or 1099-B

Box J: Long-term, 1099-DA received, basis WAS reported to the IRS

Box K: Long-term, 1099-DA received, basis NOT reported (most common in 2025)

Box L: Long-term, digital asset transaction not reported on any 1099-DA or 1099-B

Box H and Box K are the primary boxes for most 2025 filers receiving Form 1099-DA. Do not default to short-term without checking your records. Bitcoin has been around since 2009, and many sellers held for years and qualify for long-term treatment under Box K.

If you received a Code G or J on your 1099-DA, meaning basis was reported to the IRS, verify the accuracy before filing. If correct and no adjustments are needed, you may be able to aggregate those transactions on Schedule D lines 1a or 8a without listing each individually on Form 8949.

How Do Transfers Between Wallets Affect My 1099-DA?

Transfers between your own wallets are not taxable events. A transfer is not a disposition. But transfers create the biggest basis and holding period risks on your 1099-DA.

When you move crypto from a cold wallet, hardware device, or another exchange and later sell it on the receiving platform, that platform typically has no record of your original purchase price or purchase date. Transferred-in assets are noncovered, and the receiving broker generally will not have basis information available. This is the transfer trap, and it is the number one source of basis errors I am seeing in client files this season.

Starting in 2025, Rev. Proc. 2024-28 requires per-wallet and per-account basis tracking. You can no longer aggregate basis across all wallets and exchanges as one pool. If you held BTC on Coinbase and BTC on a Ledger, those are separate basis pools.

For the full details on the two allocation methods (Global Allocation and Specific Unit Allocation) and their documentation deadlines, see my comprehensive 1099-DA guide. For a deeper dive into FIFO vs. Specific ID and how the per-wallet rule works: Crypto Cost Basis in 2026: FIFO, Specific ID, and Why Your Wallet History Matters More Than Ever.

Are Stablecoin Transactions Taxable on Form 1099-DA?

Yes. Exchanging or selling a stablecoin is a taxable disposition, even if the net gain or loss is minimal. Brokers may use the Alternative Reporting Method for qualifying stablecoins under the IRS 1099-DA instructions. Under this optional method, if a customer's aggregate gross proceeds from designated stablecoin sales with that broker are at or under $10,000 for the year (after reduction for allocable transaction costs), those sales are not required to be reported.

The $10,000 threshold is per broker. A client with $8,000 in designated stablecoin sales on Coinbase and $8,000 on Kraken may receive no stablecoin 1099-DAs at all, even though the combined total is $16,000. If you do receive a stablecoin 1099-DA, check boxes 11a and 11b to see if the aggregate alternative method was used. Either way, your reporting obligation on each underlying transaction still exists, and Form 8949 still requires the detail.

Do Wash Sale Rules Apply to Crypto in 2025?

No, not for standard cryptocurrency. Bitcoin, Ethereum, and most digital assets are still classified as property under IRS guidance, not securities. IRC Section 1091 wash sale rules apply to stocks and securities, not property. Crypto investors can still legally sell a digital asset at a loss and immediately repurchase it without triggering the 30-day wash sale deferral for the 2025 tax year.

The Lummis amendment to extend Section 1091 to digital assets was not included in the One Big Beautiful Bill Act signed July 4, 2025. Standalone bill S. 2207 was introduced June 30, 2025 and includes the wash sale extension along with broader crypto tax reforms. None of it is law for TY2025. Wrapped tokens and liquid staking tokens occupy a fact-specific gray area. Discuss with your CPA.

What Should I Do If I Haven't Received My 1099-DA?

Your transactions are still taxable and reportable even without a form. Use Box I (short-term) or Box L (long-term) on Form 8949 for digital asset transactions not reported on any information return. Your exchange CSV serves as your documentation.

Late forms are expected in year one. Do not delay your filing. Start reconciling with your exchange transaction history now. If a corrected 1099-DA arrives after you file, you may need to amend.

New Jersey Filers: Why This Matters Even More for You

If you are in New Jersey, basis errors are not just a federal problem. They compound at the state level. NJ taxes all crypto gains as ordinary income with no long-term capital gains rate distinction. The NJ graduated rate schedule reaches 10.75% for income over $1 million. And NJ does not allow capital loss carryforwards in the "Net gains from disposition of property" category. If your losses exceed your gains in a given year, the net loss is treated as zero at the state level.

Additionally, Form 1099-DA is not part of the Combined Federal/State Filing Program for TY2025, meaning no state revenue department automatically received your 1099-DA data this year.

For a complete breakdown of how NJ handles crypto differently from federal: How New Jersey Taxes Your Crypto: A State-by-State Gap That Catches NJ Investors Off Guard.

What to Do Right Now: Your 1099-DA Filing Checklist

Step 1: Download your full transaction history CSV from every exchange you used in 2025.

Step 2: If you have your 1099-DA, compare Box 1f (proceeds) against your CSV. Look for discrepancies.

Step 3: For every disposition showing blank or $0 basis, reconstruct your actual cost from purchase records, transfer records, and wallet history.

Step 4: Determine your holding period for each transaction (short-term or long-term) from your own records. Do not rely on the form.

Step 5: Run a three-way reconciliation: 1099-DA vs. exchange CSV vs. on-chain wallet data. The goal is an accurate return, not a form that matches.

Step 6: If your 1099-DA has not arrived or looks incomplete, do not wait. Start reconciling with your CSV now. Late and corrected forms are expected in year one.

Frequently Asked Questions About Form 1099-DA

What is Form 1099-DA?

Form 1099-DA is a new IRS information return that digital asset brokers use to report cryptocurrency transaction proceeds to both the taxpayer and the IRS, starting with Tax Year 2025. It is the crypto equivalent of Form 1099-B used for stock transactions.

Is cost basis reported on Form 1099-DA for 2025?

Cost basis reporting is entirely voluntary for TY2025. The IRS 1099-DA instructions explicitly state that brokers are not required to report basis for sales effected in 2025. Mandatory basis reporting begins for covered digital assets acquired on or after January 1, 2026.

What does blank basis on my 1099-DA mean?

A blank basis means the broker chose not to report your cost. It does not mean your basis is $0. You must reconstruct your actual cost from your own records and enter it in Column (e) of Form 8949. Filing without it means overpaying on phantom gains.

What if my 1099-DA shows $0 in cost basis and I paid for the asset?

That is a broker error. The 1099-DA instructions direct brokers to enter $0 in Box 1g only if the asset's basis is actually zero. Reconstruct your actual cost and document it.

Which Form 8949 box do I use for crypto?

Boxes G/H/I for short-term and J/K/L for long-term. Never use boxes A-F for digital assets. Box H (short-term, basis not reported) and Box K (long-term, basis not reported) are the most commonly used for TY2025.

What is Code Y on my 1099-DA?

Code Y signals that the broker is not reporting basis and cannot determine your holding period. You must determine short-term vs. long-term from your own records and use Box H or Box K on Form 8949.

Will my staking or DeFi activity appear on Form 1099-DA?

Generally no. The DeFi broker reporting rule was repealed, and brokers are not required to report certain staking-related structures for TY2025 under Notice 2024-57. Your tax obligations on all of this income remain under current IRS guidance.

Do I still need to report crypto if I didn't receive a 1099-DA?

Yes. Use Box I (short-term) or Box L (long-term) on Form 8949 for digital asset transactions not reported on any information return. Keep your exchange CSV as documentation.

Need a CPA to Review Your 1099-DA?

The IRS now has standardized third-party proceeds reporting for digital assets at a scale it has never had before. The margin for error is smaller than it has ever been.

If you want a line-by-line review of your 1099-DA against your exchange CSV before you file, visit monacocryptotax.com or reach out via DM. I work with crypto investors and traders nationwide, with particular expertise in the New Jersey state tax complexities that national preparers consistently miss.

This article is for informational purposes only and does not constitute tax advice. Tax outcomes depend on your specific facts and circumstances.

Greg Monaco, CPA/MBA | NJ CPA License #20CC04711400 | Firm License #20CB00789800 | Crypto Tax: [monacocryptotax.com](https://monacocryptotax.com) | Full-Service CPA: [monacocpa.cpa](https://monacocpa.cpa)

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