Your 1099-DA shows proceeds but may omit basis. I compare it with client-supplied transaction records, document supported basis and Form 8949 treatment, and identify gaps that cannot be resolved from the records provided.
Gregory Monaco, CPA LLC, a New Jersey CPA firm doing business as Monaco CPA and MonacoCryptoTax. Engagement scope is set out in a written scope confirmed before work begins.
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For the 2025 tax year, exchanges are issuing Form 1099-DA for the first time, and the form has serious limitations. Under Treasury Decision 10000, brokers like Coinbase, Kraken, and Robinhood are reporting gross proceeds but are not required to report cost basis for most assets (per IRS Instructions for Form 1099-DA, 2025). For many crypto investors, the cost-basis box on their 1099-DA is left blank or shows "Unknown" on most lines.
A Form 1099-DA without reported cost basis does not establish gain. The taxpayer must calculate gain or loss from the actual proceeds, supported basis, and other applicable adjustments.
Here's a real-world example: Say you bought $10,000 of Bitcoin on Coinbase, transferred it to Kraken, and later sold it for $12,000 on Kraken. Your Kraken 1099-DA would show $12,000 in proceeds and no reported cost basis. The Form 1099-DA does not by itself state the gain. In this illustration, $10,000 of supported basis produces a $2,000 gain before other applicable adjustments.
What Your 1099-DA Shows
What Actually Happened
Example for illustration only.
On top of that, starting in 2025 the IRS requires cost basis to be tracked at the wallet and account level (per Treas. Reg. §1.1012-1(j)), eliminating the previous universal pooling method. Rev. Proc. 2024-28 provides a safe harbor for allocating pre-2025 "unattached" basis to wallets and accounts as of January 1, 2025, subject to specific recordkeeping and completion requirements. This means transferring crypto between wallets can create additional cost basis complexity that your 1099-DA simply doesn't reflect.
If you transferred crypto between exchanges or wallets, your 1099-DA may show "Unknown" cost basis. Client-supplied acquisition and transfer records may support a different reported gain; absent records remain an unresolved basis gap.
Beyond the immediate tax impact, a discrepancy between what your exchange reported and what you file can create mismatch risk in the IRS's Automated Underreporter (AUR) process. AUR may generate a CP2000 notice when amounts disagree. Reconciliation can document valid basis, timing, aggregation, or fee differences, but it cannot guarantee that the IRS will not issue a notice.
The IRS has publicized blockchain-analytics capabilities (for example Chainalysis and Elliptic) to trace on-chain activity, and Operation Hidden Treasure was announced with that aim - though TIGTA Report 2024-300-030 found the initiative's charter lacked specific enforcement deliverables and had no written results summaries. Separately and more concretely, the Automated Underreporter (AUR) process (IRM 4.19.3) compares information returns against filed returns and may issue a CP2000 when amounts disagree. Reconciliation documents the reported differences but does not determine whether the IRS will issue a notice.
This is what the 1099-DA Reconciliation Service evaluates. I compare the client-supplied records, document supported proceeds, basis, holding periods, and adjustment-code treatment, and state unresolved gaps. No completeness or IRS-outcome result is promised.
Learn more about the crypto tax services or review the currently published tax resources.
An accepted engagement identifies its included components in writing. The analysis is limited to client-supplied records, documents unresolved gaps, and has no fixed turnaround promise.
Line-by-line comparison of client-supplied 1099-DA, exchange CSV, and on-chain or wallet records within the accepted scope, with unresolved gaps documented.
Identification and documentation of missing cost basis for transferred-in assets, cross-exchange activity, and noncovered lots to the extent supported by client-supplied records.
Reporting comparison of FIFO and adequately documented Specific Identification for completed dispositions, limited to methods permitted by the records and tax rules. This is not an investment, sale, repurchase, or timing recommendation.
Form 8949 box-routing analysis (G/H/I, J/K/L) and supported reconstructed basis in Column (e). The missing-basis case needs no adjustment code; Column (f) codes are documented only where supported (for example, Code B when correcting basis a broker reported to the IRS).
Identification of figures that may create AUR mismatch or CP2000 notice risk, with a documentation strategy; a mismatch does not guarantee a notice.
State-specific notes where relevant, including NJ's bucket system and no-carryforward rule.
Foreign-platform records are identified for education and referral only. Monaco CPA does not prepare FBAR, Form 8938, or other international information returns.
A written report describing the records reviewed, observed reporting issues, return treatment, and any unresolved data gaps.
This reconciliation is a standalone deliverable that documents return-reporting treatment supported by the supplied records. An accepted engagement may also include return preparation through the Crypto Tax Preparation service.
These examples identify records that may need investigation; they do not assert a frequency, error, or tax result for any taxpayer.
Download the recipient statements and transaction records actually available for each account. Reporting and export formats depend on the platform, account, activity, and current broker procedures.
Download every recipient statement and the complete transaction-history export available for the account. A single PDF may contain multiple information-return forms, so review the complete document rather than assuming Form 1099-DA is delivered separately.
A broker statement may show missing, informational, or taxpayer-supplied basis for an asset transferred from another wallet or platform. Preserve acquisition and transfer records; a displayed basis amount is not independently verified merely because it appears on a statement or export.
Software output depends on complete and correct imports, transfer matching, basis history, and settings. Some products can carry or edit basis and flag anomalies, but unresolved source-data gaps and return characterization still require review.
The 2025 repeal of the specified DeFi broker rule does not determine whether another reporting broker issues a form and does not make underlying activity nontaxable. Provide available wallet, block-explorer, protocol, and aggregator records, plus any form actually received.
Other-exchange records are reviewed during intake to confirm format and scope. Monaco CPA does not promise support for every exchange; provide the 1099-DA and transaction-history export available from your platform.
Records from an unlisted broker are considered during intake for format and scope; support is not promised. A contact-form submission does not guarantee a response, quote, or engagement. Submit an intake request →
Pricing is based on the number of exchanges and wallets involved and the complexity of the supplied transaction history. A contact-form submission is an intake request only. If I accept the requested work, the scope and price are stated in writing before the engagement begins; no response, quote, or engagement is guaranteed.
Starting at
$350
Best for: Buy-and-hold investors or single-exchange traders
Use the contact formStarting at
$750
Best for: Active traders who moved crypto between exchanges or used self-custody
Use the contact formStarting at
$1,250
Best for: Filers seeking accepted return preparation with reconciliation
Use the contact formThese are starting prices, not quotes. What a reconciliation actually costs depends on the accepted written scope, the number of exchanges and wallets, transaction volume, how many tax years are involved, whether basis has to be reconstructed across transfers, and the condition of the records supplied. If an intake request is accepted, the exact scope and price are stated in writing before the engagement begins; no response or quote is guaranteed. See pricing for the firm's other services →
| What’s included | Single Exchange $350 | Multi-Exchange $750 | Tax Prep Bundle $1,250 |
|---|---|---|---|
| 1099-DA reconciliation vs. transaction CSV | |||
| Cost basis reconstruction (on-platform) | |||
| Form 8949 mapping with adjustment codes where they apply | |||
| Plain-English summary report | |||
| Multiple exchanges + self-custody wallets | - | ||
| Cross-exchange transfer basis reconstruction | - | ||
| Rev. Proc. 2024-28 allocation analysis | - | ||
| Foreign-platform records flagged for specialist referral | - | ||
| Completed-disposition reporting-method comparison | - | ||
| Federal + state return preparation under the written scope | - | - | |
| Secure TaxDome submission for accepted return preparation | - | - |
Use the contact form to describe your crypto activity, exchanges used, and complexity. A submission may or may not receive a written scope and price; it does not guarantee a response, quote, or engagement.
If I offer a written scope and price and you accept the engagement, I open a secure TaxDome portal for the client-supplied records named in that scope.
I review the client-supplied records within the accepted scope and provide a written reconciliation of observed reporting issues, supported treatment, and unresolved data gaps. No fixed turnaround is promised.
Software output depends on complete and correct imports, transfer matching, basis history, elections, and settings. Some products can carry or edit basis and diagnose transfers or anomalies. No product is categorically sufficient or insufficient; unresolved source-data gaps, return characterization, and adjustment-code application may still require fact-specific review.
A CPA reconciliation can evaluate issues that software does not address. If the IRS later questions the return, the workpapers document the records reviewed, supported reporting treatment, and unresolved gaps rather than promising an IRS outcome.
On extension? If you filed Form 4868, your 2025 return is due October 15, 2026. If tax remains unpaid, interest may continue to accrue. An accepted return-preparation scope may include a written payment calculation, but the client transmits any payment and remains responsible for meeting the deadline.
The IRS now receives standardized third-party proceeds data for digital assets. Differences between that data and Form 8949 can affect reported gain and create AUR or CP2000 mismatch risk. Reconciliation documents the records and reporting treatment; it does not promise a particular tax or IRS outcome.
Gregory Monaco, CPA LLC, a New Jersey CPA firm doing business as Monaco CPA and MonacoCryptoTax. Engagement scope is set out in a written scope confirmed before work begins.
Not sure what documents to gather? Use the crypto filing checklist to gather the records available for intake.
Tax advice disclaimer: This material is for general educational information only and is not legal, tax, or accounting advice for your specific facts. A CPA-client relationship is formed only through a signed engagement letter.