1099-DA: what the crypto tax form shows and leaves out

What is a 1099-DA?

Form 1099-DA is titled Digital Asset Proceeds From Broker Transactions [1]. A broker files it. The instructions define a broker as any person who, in the ordinary course of a trade or business, stands ready to effect sales of digital assets for others, and say that generally only a US digital asset broker has to report [2]. The IRS’s own summary of the rules says they apply to brokers that take possession of the assets being sold: custodial trading platforms, certain hosted wallet providers, kiosks, and certain payment processors [12].

A digital asset, for the form, is any digital representation of value recorded on a cryptographically secured distributed ledger, and not cash [2]. So a coin, a stablecoin, and an NFT are all in. Dollars in the account are not.

The dates come from the regulations, not from a press release. The final rule under section 1.6045-1 applies to sales of digital assets on or after January 1, 2025 [4]. Brokers report basis for transactions on or after January 1, 2026, and only for digital assets the customer bought from, and kept with, the same broker on or after January 1, 2026 [4]. The statements for 2025 sales were due to recipients by February 17, 2026 [11].

The first year had a safety net for the broker, not the holder. For sales during calendar year 2025 the IRS said it would not impose the two information-return penalties on a broker that made a good-faith effort to file and furnish the forms [5]. Backup withholding was not required on any digital asset sale in 2025 [5], and Notice 2025-33 extended that withholding relief through sales effected in calendar year 2026 [6].

A thin or late 2025 form is inside those rules. The holder’s own return is not.

The revision this guide reads is the 2026 form and the instructions dated 2026 [1] [2]. The About page lists corrections to the 2025 instructions and names the two 2024 notices as the related guidance [3]. The instructions on irs.gov were re-read on the date at the top of this page and matched the copy in the receipts word for word.

What does each box report?

Every line below comes from the 2026 instructions [2], in plain words. Nothing here is from memory.

Box	What it holds
Checkbox for Form 8949	One letter, G, H, J, K, or Y, telling the holder which box to check on Form 8949 [2]
1a	The digital token identifier: nine characters from the DTIF registry, or 999999999 if the asset is not registered [2]
1b	The asset’s full name, matching the registry entry when there is one [2]
1c	Units sold, to 18 decimal places [2]
1d	Date acquired, left blank when the lots were acquired on different dates or the broker does not know it [2]
1e	Date sold or disposed [2]
1f	Gross proceeds, reduced by the transaction costs of the sale, including fees, commissions, and transfer taxes [2]
1g	Cost or other basis, blank when the broker checks box 9 and reports none [2]
1h	Accrued market discount, for a covered security that is also a debt instrument [2]
1i	Wash sale loss disallowed, for tokenized securities under section 1091 [2]
2	Checked when the basis in 1g was reported to the IRS [2]
3a	Whether 1f is gross or net proceeds [2]
3b	Checked when the proceeds are from a qualified opportunity fund [2]
4	Federal income tax withheld, which is backup withholding [2]
5	Checked when a loss is not allowed based on the amount in 1f [2]
6	Gain or loss: short-term or long-term, and an Ordinary checkbox [2]
7	Checked when only cash was paid in the transaction [2]
8	Checked when the broker relied on acquisition information the customer provided [2]
9	Checked when the asset is a noncovered security [2]
10, 13	Reserved [2]
11a, 11b, 11c	The optional reporting method for qualifying stablecoins and specified NFTs, the number of transactions, and proceeds from a primary sale [2]
12a, 12b	Units transferred into the account, to 18 decimal places, and the transfer-in date [2]
14, 15, 16	State name, state identification number, and state tax withheld [2]

Three of those boxes carry the whole story. Box 1f is the number the IRS has. The instructions tell the broker to reduce it by the transaction costs of the sale [2], so it is already net of the exchange fee. Box 1g is the number the IRS may or may not have, and box 2 says which.

Box 9 is the one to look for first. When the broker checks it, the asset is a noncovered security, and the broker does not have to fill in the acquisition date, the basis, the market discount, the wash sale amount, or the gain or loss [2]. A broker may fill them in anyway without penalty when box 9 is checked [2]. When box 9 is not checked and a number in those boxes is wrong, the broker is the one exposed to penalties [2].

Box 6 tells the holder which part of Form 8949 the sale belongs on. The broker decides short-term or long-term under section 1222 and checks Ordinary when any part of the gain may be ordinary [2]. The letter in the checkbox at the top says the same thing in one character: G or H for short-term, J or K for long-term, and Y when the broker does not know the holding period [2].

Box 4 is backup withholding. The rate is the fourth-lowest individual rate, currently 24 percent, and it applies when the payee has not furnished a taxpayer identification number [6]. It was not required on any 2025 sale and, under Notice 2025-33, not on any 2026 sale either [5] [6].

What does it not do?

The form reports what one broker did. It does not know what happened anywhere else, and the instructions say so in the definition of a covered security.

A covered security is a digital asset acquired after 2025, in an account the broker provided custody for, and held in that account until the broker sold it [2]. Everything else is a noncovered security, and the instructions list the shapes: an asset the broker did not custody when it was acquired, an asset acquired before 2026, and an asset transferred in to the broker [2]. A coin bought in 2021, a coin moved in from a hardware wallet, and a coin bought on an exchange that later closed are all noncovered. The form carries their proceeds and not their basis.

A transfer between two wallets is not a sale. The instructions define a sale as a disposition for cash, stored-value cards, different digital assets, or the broker’s services, plus a few contract settlements and payment cases [2]. Moving coins from a wallet into a broker account shows up on the form only as boxes 12a and 12b, the units and the date that came in [2].

Decentralized platforms are outside these regulations. The final rule did not finalize the digital asset middleman rules for non-custodial participants [4], and the IRS summary says plainly that the regulations do not include reporting requirements for decentralized or non-custodial brokers [12]. Whatever those platforms will owe is not in the documents this guide cites, so this guide says nothing about it.

Some transactions at a custodial broker are also held back. Notice 2024-57 says brokers are not required to report wrapping and unwrapping, liquidity provider transactions, staking, lending, short sales of digital assets, or notional principal contracts until further guidance [5]. Rewards and staking payments do not go on a 1099-DA at all [2]. A broker is also not required to file for sales inside an IRA [2], which is one reason the crypto IRA guide reads differently from this one.

A dead exchange sends nothing. FTX and Celsius stopped being brokers before the first form was due, so a holder who sold on either one has no 1099-DA for it and has to rebuild the basis from records. The FTX guide and the Celsius guide walk through what each estate left behind.

The per-wallet basis rule sits underneath all of this. Since January 1, 2025, basis is tracked wallet by wallet, and Rev. Proc. 2024-28 gave a safe harbor for allocating old basis into wallets as of that date [4]. The cost-basis guide covers the allocation and its deadline.

Which units a broker sold is a second question. Notice 2025-7 let a holder identify them through the holder’s own records, for the period from January 1, 2025 through December 31, 2025 [7], and Notice 2026-20 extended that relief to December 31, 2026 [8]. Box 8 is where a broker records that it relied on that kind of customer-provided information [2].

How does it reconcile with the return?

The 1099-DA lands on Form 8949, and the instructions for that form say what to do with each number. The proceeds shown on the 1099-DA always go in column (d) [9]. When the form shows that basis was reported to the IRS, that basis goes in column (e), and any correction goes in column (g) with a code in column (f) [9]. A basis the broker left blank is supplied from the holder’s records in column (e).

The checkboxes at the top of Form 8949 changed for digital assets. A short-term sale with a 1099-DA goes under box G when basis was reported or box H when it was not; a long-term sale goes under box J or box K on the same split [9]. A sale with no form at all goes under box I or box L, and the instructions say not to use box C or box F for digital assets [9]. Schedule D gained matching lines: codes G through L were added to lines 1b, 2, 3, 8b, 9, and 10 [10].

There is one shortcut. Exception 1 lets a holder skip Form 8949 and report totals straight on Schedule D line 1a or 8a, but only for sales where the 1099-DA shows basis reported to the IRS, shows no adjustments in boxes 1h or 1i, and the Ordinary box in box 6 is not checked [9]. A sale with box 9 checked does not qualify, and for most holders that is every sale of a coin bought before 2026.

When the holding period is unknown, the holder’s records decide. The 2025 Form 8949 instructions say that when box 6 is blank and the top checkbox carries code X, the broker does not know whether the gain is short-term or long-term, and the holder uses their own records [9]. The 2026 Form 1099-DA instructions call that same situation code Y [2]. Both are printed here; conflict ledger row 9 carries the disagreement, and the 2026 form’s own instructions govern what the 2026 form prints.

When the form and the records disagree on proceeds, the form’s number still goes in column (d) and the difference is explained in column (g) [9]. When they disagree on basis, the records win only if they are records: a dated export, a chain history, a price from a named source.

Tax software does the same job mechanically. It imports the 1099-DA and the wallet history, matches each sale to a lot, and writes the Form 8949 line with the code. It cannot invent a basis the records do not hold.

What about worthless and rugged tokens?

They will not be on the form. A token still sitting in a wallet was never sold, no broker effected a sale, and a 1099-DA reports sales [2]. Silence on the form is not a deduction, and it is not a loss the IRS has been told about.

A dust sale is different. A token sold at a broker for a few cents is a sale, so it appears with its proceeds in box 1f. If the token was bought before 2026 or moved in from a wallet, it is noncovered, so box 9 is checked and box 1g is blank [2]. The loss is the holder’s basis minus those proceeds, on Form 8949 under box H or box K, from records the broker never had.

The worthless-token guide covers which route books the loss, and the calculator runs the arithmetic on a basis and a sale price.