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Key takeaways
- Transferring crypto between your own wallets isn't a taxable event. However, spending cryptocurrency on transfer fees counts as a taxable disposal. While the tax impact is minimal, these ‘disposals’ will appear on Form 1099-DA.
- Cost basis is often missing or wrong on Form 1099-DA when you've transferred crypto between platforms. There’s no need to request a corrected form for this issue, simply report your corrected cost basis on Form 8949.
Do I get Form 1099-DA if I transfer crypto?
You’ll receive Form 1099-DA from an exchange if you had any cryptocurrency disposals on that platform during 2025. This includes selling, trading, or spending crypto.
While transferring cryptocurrency isn’t taxable, it’s likely that you paid transfer fees as part of the transaction. Spending cryptocurrency on fees counts as a disposal, which means that it gets reported on Form 1099-DA.
The good news is that your capital gain or loss from gas fees is usually minimal, since the transactions are usually a few dollars at most. However, these transactions still need to be reported to the IRS.
Why transfers create cost basis problems
Beyond the tax implications of transfer fees, wallet-to-wallet transfers can cause other issues on Form 1099-DA.
Because exchanges have no visibility into transactions that took place on other platforms, cost basis information is often incomplete/missing if you transferred crypto to an exchange.
In this example, Robert should have $1,000 of capital gain. However, Form 1099-DA from Exchange B will show "Unknown" or blank for cost basis. If he simply copies and pastes the numbers from Form 1099-DA, he may be responsible for $6,000 of capital gain.
Luckily, there’s an easy fix to this issue. At this time, the IRS allows taxpayers to report their correct cost basis on Form 8949, provided that they have backing documentation.
What do I do with my Form 1099-DA?
Form 1099-DA should be used as a reference point for reporting your taxes. You can then report your transactions on Form 8949.
Here's the process:
- Review your Form 1099-DA. Make sure the proceeds numbers on your form line up with your own records (If there is a major discrepancy, take a look at the next section).
- Account for your transactions across all of your wallets and exchanges. Then, fill in the missing cost basis information.
- Complete Form 8949 with accurate numbers.
- Transfer the totals to Schedule D and include it with your tax return.
What do I do if Form 1099-DA is wrong?
In some cases, your Form 1099-DA may be completely inaccurate. For example, proceeds may be completely wrong.
If you find yourself in this situation, here are some steps you can take:
Calculate your actual tax liability: Use your own transaction records or crypto tax software to determine what you really owe.
Request a corrected form: Contact your exchange's support team and ask for a corrected Form 1099-DA. Be specific about what's wrong and document your efforts to contact the exchange. This can help if the IRS investigates your tax return in the future.
Consider a tax extension: If you're waiting on a corrected form and the filing deadline is approaching, file for an extension. This gives you until October to submit your return.
Attach an explanation to your return: Attach a brief explanation noting the discrepancy, the steps you took to fix it, and how your Form 8949 reflects your actual taxable income.
Remember, there’s no need to request a corrected Form 1099-DA if your cost basis is incorrect. Simply report your correct cost basis on Form 8949.
How CoinLedger can help
Dealing with missing cost basis, transfers between platforms, and incomplete forms is stressful. CoinLedger automates the entire process.
CoinLedger generates complete crypto tax forms in minutes. The platform is trusted by more than 700,000 investors around the world.
Frequently asked questions
- Does transferring crypto trigger Form 1099-DA?
- Why is cost basis missing on my Form 1099-DA after I transferred crypto?
- Do gas fees from transfers appear on Form 1099-DA?
- Can I ignore Form 1099-DA if I transferred most of my crypto off exchanges?
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How we reviewed this article
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