Crypto’s Anonymous Era Just Ended: Form 1099-DA Now Tells the IRS What You Sold and Its Cost-Basis Math May Not Match Yours

In 2025, the IRS will send out Form 1099-DA to crypto investors, a new tax form that reports gross proceeds from broker transactions. However, this form does not include cost basis or overall gain/loss information, which may lead to an overstatement of taxable crypto gains on the IRS return. Transfers between your own crypto wallets might be mistakenly reported as taxable sales, creating phantom income.

Reporting cost basis becomes mandatory in 2026 for certain digital assets, so keeping accurate records before December 31 is crucial. Form 1099-DA is similar to the 1099-B form used for stock sales, but with the basis field left blank. It's essential to reconcile the form against your personal records to ensure accurate reporting.

Not all tax events are covered by Form 1099-DA, such as transfers between personal wallets or some decentralized transactions. Staking rewards, mining, airdrops, and services rendered in crypto are considered income and must be reported accordingly. If you have activity across multiple exchanges or self-custodial accounts, seek advice from a tax professional with comprehensive knowledge of all your transactions.