How to read Form 1099-DA (2026)

What is Form 1099-DA?

Form 1099-DA is a new IRS tax form that centralized crypto exchanges are required to send to customers who sold or traded digital assets in the tax year 2025. Exchanges issue the form to users and the IRS.

The "DA" stands for Digital Assets. The form tells the IRS about the proceeds from your cryptocurrency disposals (transactions where you sold/traded away/spent cryptocurrency).

As of 2026, exchanges are not required to report cost basis to the IRS on Form 1099-DA. In many cases, cost basis information on the form is missing/incomplete/incorrect (more on this later). 

What's on Form 1099-DA?

Here are the fields you’ll see on Form 1099-DA: 

• Name: The name of the cryptocurrency. 
• Date sold or disposed of: The day you sold, traded away, or otherwise disposed of your cryptocurrency.
• Number of units: Quantity of the crypto sold (e.g., "0.5").
• Date acquired: When you originally obtained the asset. This determines whether your gain is long-term or short-term (taxed at a higher rate). This date may be wrong or unknown if you transferred crypto from another platform. 
• Proceeds: How much you received from the sale. This is not your profit, it's the total sale amount. 
• Cost or other basis: What you originally paid for the asset. This is frequently blank or listed as ‘Unknown’. 
• Gains/losses: Your total gain/loss from the disposal. 

Remember, there’s no need to request a new Form 1099-DA if your cost basis is missing/inaccurate. You can simply report the correct cost basis on Form 8949 (more on this in the next section). 

What do you do with Form 1099-DA?

Remember, Form 1099-DA is an informational form with data that may be incomplete. Here's what you should do when you receive one:

1. Use the form as a starting point, not as a final source of truth: Double-check to make sure that the proceeds numbers on Form 1099-DA match your records. Then, calculate your gains and losses from all of your wallets and exchanges manually or with crypto tax software.
2. Complete Form 8949: Once you’ve accounted for all of your transactions across your wallets and exchanges, fill out Form 8949 with your accurate cost basis numbers. Remember, the cost basis numbers on Form 1099-DA can be inaccurate (more on this later).
3. Transfer totals to Schedule D: Copy over your net capital gain/loss and include it with your tax return.

The cost basis problem (and why it's not your fault)

Cost basis (the price of your crypto at the time of acquisition) is used to calculate your capital gains and losses. 

Capital Gain/Loss = Proceeds - Cost Basis 

For 2025, most 1099-DAs will show cost basis as blank or ‘Unknown’. If you simply copy and paste the numbers from Form 1099-DA, you may end up over-reporting your capital gains and overpaying. 

Why is cost basis often missing on Form 1099-DA?

Exchanges only know what you paid if you bought the asset directly on their platform and never moved it. If you:

• Bought crypto elsewhere and transferred it in
• Bought on the exchange, transferred it out, and transferred it back in

In cases like these, the exchange has no record of your original purchase price. As a result, cost basis information on Form 1099-DA will be missing or inaccurate. 

What to do about cost basis errors?

Under current IRS guidelines, you're allowed to use your own records for reporting your cost basis on Form 8949 as long as you maintain adequate documentation.

The first step is to gather records from wherever you originally acquired the crypto: transaction histories, purchase confirmations, or records from other exchanges or wallets. Then, you can make sure to report your transactions with the correct cost basis information on your tax return. 

If you’re having trouble calculating cost basis, crypto tax software like CoinLedger can automatically import your wallets and exchanges, help you pull together transaction history, and fill in missing basis information. 

Who receives Form 1099-DA?

You'll receive Form 1099-DA if you sold, traded, or otherwise disposed of crypto on a centralized exchange in 2025. 

There is no minimum threshold for Form 1099-DA. Some investors have reported receiving it for less than $1 in capital gains. 

What does Form 1099-DA cover, and what’s missing?

Form 1099-DA only covers activity on the exchange that issued it. It does not capture your full activity. 

Transactions typically included:

• Crypto-to-cash sales
• Crypto-to-crypto trades
• Cryptocurrency spent on network fees 

Transactions typically not included: 

• DEX and DeFi activity
• Trades on non-KYC exchanges
• Staking rewards and interest income (these usually appear on Form 1099-MISC)

Just because a transaction doesn't appear on your 1099-DA doesn't mean it's non-taxable. You're still responsible for reporting all of your taxable income from cryptocurrency, including DeFi trades and transactions on other platforms. 

Short-term vs. long-term gains

Your Form 1099-DA contains records of when you originally acquired your cryptocurrency. This is important because your cryptocurrency is taxed differently depending on how long you held it. 

• Short-term: Cryptocurrency disposed of after you held it for 12 months or less. Taxed as ordinary income at your regular income tax rate (10-37%). 
• Long-term: Cryptocurrency disposed of after you held it for a year or more. Taxed at lower capital gains rates: 0%, 15%, or 20%, depending on your income.

If the acquisition date is incorrect on Form 1099-DA, you may overpay on taxes. Remember, you can report the correct acquisition date of your cryptocurrency on Form 8949.

Why are transfers reported on Form 1099-DA? 

If you see wallet-to-wallet transfers reported as disposals on Form 1099-DA, you are likely seeing crypto spent on gas/network fees. 

When you spend cryptocurrency on gas fees, this is counted as a ‘taxable disposal’. While it’s likely that your capital gain/loss is minimal, it’s still reported on Form 1099-DA. 

Why don’t my proceeds numbers match my Form 1099-DA? 

The proceeds that you see on Form 1099-DA may not match the numbers in your own records. This usually happens due to different cryptocurrency pricing data sources. 

If you notice a minor difference, we recommend matching the proceeds shown on your Form 1099-DA. This is the best way to avoid further IRS scrutiny of your tax return. 

If the proceeds numbers on your Form 1099-DA are significantly different from your records, consider requesting a corrected form (more on this later). 

What do I do about stablecoin proceeds? 

In some cases, customers see a large amount of proceeds on Form 1099-DA due to stablecoin transactions. 

Stablecoins are taxed like other cryptocurrencies. You are required to report your disposals on Form 8949, along with your gain/loss. 

Remember, capital gains and losses from stablecoins are usually close to 0 (because their prices are typically pegged to the US dollar). 

If you see a large amount of proceeds from stablecoins with no cost basis, don’t panic. Your capital gain is likely minimal. The best solution is to use crypto tax software to find your cost basis, date of acquisition, and other information you need to fill out your tax return.

What if my Form 1099-DA is completely wrong?

In some cases, your Form 1099-DA may be completely inaccurate. It may list transactions that never occurred or major discrepancies in proceeds numbers.

In cases like these, you should take the following steps: 

1. Calculate your tax bill using your own records/crypto tax software. 
2. Contact the exchange’s support and request a corrected Form 1099-DA. 
3. Consider filing a tax extension to give yourself time to receive a corrected form before filing.
4. Attach an explanatory memo to your tax return. Briefly note the discrepancy, the steps you took to correct it, and how your Form 8949 reflects your actual activity.

As noted earlier, cost basis showing as "Unknown" is not an error. You can simply correct cost basis errors on Form 1099-DA. 

Will the IRS flag me if my numbers don't match the form?

Major discrepancies between the proceeds on Form 1099-DA and the proceeds you report to the IRS may lead to your tax return getting flagged.

In 2026, exchanges are not required to track cost basis. You should not be concerned about cost basis differences between Form 1099-DA and your tax return. 

Get started with CoinLedger 

Want to generate a complete Form 8949 in minutes? Connect your wallets and exchanges to CoinLedger, and get a complete record of your gains and losses. 

Get started with CoinLedger for free.