What is Form 1099-DA and how does it affect my crypto taxes for 2025?

Form 1099-DA is the IRS's new digital asset reporting form. Starting with 2025 transactions (filed in 2026), U.S.-based centralized crypto exchanges are required to report your crypto sales to the IRS — and send you a copy. This is a major change in how crypto is tracked.

What brokers are required to report:

• Your gross proceeds from crypto sales and exchanges
• The cost basis (acquisition cost + fees) for covered securities — assets acquired on or after January 1, 2025
• The acquisition date, gain/loss amount, and whether it's short-term or long-term

What's NOT covered by 1099-DA:

• Sales on non-custodial (self-custody) platforms — DEXs, MetaMask, Uniswap, etc. are currently exempt under transition relief
• Assets acquired before 2025 — brokers are not required to report cost basis for these "non-covered" securities
• Crypto-to-crypto swaps in some categories covered by IRS Notice 2024-57 temporary relief
• Staking rewards, airdrops, and DeFi activity — not captured by 1099-DA

What this means for you:

• Covered assets (bought on a major exchange after Jan 1, 2025): Your exchange will send you a 1099-DA. The IRS receives a copy. Make sure your tax return matches — discrepancies trigger automated CP2000 notices.
• Pre-2025 assets: You still owe tax on gains, but the exchange may not have your cost basis. You need your own records.
• DeFi and self-custody transactions: Still taxable, still your responsibility to report. IRS guidance here is still evolving.

How to handle it on your return:

• Report all crypto sales on Form 8949 and Schedule D, as always
• For covered assets with a 1099-DA, the numbers will be pre-populated in many tax software programs
• For non-covered assets, manually enter your cost basis using your own transaction records

Key risk: If you received a 1099-DA but don't include those transactions on your return, the IRS's automated matching system will send a CP2000 notice. Respond promptly if you receive one.