If you have never bought, sold, received or swapped a digital asset, this article is not for you — though you will still meet the question on your return, and the answer is No.

Everyone else now has a new form in the mix.

The short answer

Form 1099-DA reports digital asset proceeds from broker transactions — what a sale produced. Whether it also reports what you paid depends on what you sold:

What you sold Basis on the form?
A covered digital asset, sold after 2025 required
A noncovered digital asset not required — broker may report voluntarily
Under the optional methods for qualifying stablecoins or specified NFTs may be omitted

Proceeds minus basis is the gain. When the second number is not on the page, the form is showing you one half of a subtraction — and the half it shows is the big one.

Why this catches people

A 1099-K reports gross settlement and people mistake it for profit. A 1099-DA invites a version of the same mistake, with a sharper edge: the missing figure is not a fee you can look up on a statement. It is what you paid, possibly years ago, possibly on a platform you no longer use.

The instructions are specific about when the broker has to fill it in:

"For sales a broker has effected for customers after 2025 of digital assets that are covered securities, the broker is required to report basis information."

And when it does not:

"For sales a broker has effected for customers after 2025 of digital assets that are noncovered securities, the broker is not required to report basis information. However, the broker may voluntarily report this information."

Where the gap usually comes fromA broker can only report a basis it knows. Assets you bought elsewhere and transferred in are exactly the ones most likely to arrive with proceeds and nothing else.

A missing basis is not a basis of zero. It is a number you have to produce and support.

The question you answer before any of this

Form 1040 asks it directly:

"At any time during the tax year, did you: (a) receive (as a reward, award or payment for property or services); or (b) sell, exchange, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?"

The IRS lists what makes the answer Yes. Receiving digital assets as:

  • payment for property or services provided;
  • a reward or award;
  • mining, staking and similar activities.

And disposing of digital assets:

  • for another digital asset;
  • for U.S. dollars or other currency;
  • in exchange or trade for property, goods or services.

The line that surprises people most

Look at the first disposal: for another digital asset.

Swapping one coin for another is a disposal. No dollars move, nothing leaves the exchange, your bank sees nothing — and you have disposed of property. The dozens of routine swaps that feel like rearranging a portfolio are, each one, a disposal with a proceeds figure and a basis figure attached.

Buying a coffee with crypto is the same thing in miniature: a disposal in exchange for goods.

And "I lost money" is not an exemption

"If you have digital asset transactions, you must report them whether or not they result in a taxable gain or loss."

That sentence removes the most common reason people skip the work. A flat or losing year is still a reporting year. It is also the year where accurate basis is most valuable to you, since an unreported loss is one you cannot use.

What to keep, and when

Everything above turns on records the broker may not have. Three habits cover it.

  1. Record every acquisition at the time: date, quantity, what you paid including fees, and where it happened. This is the number that may never appear on any form.
  2. Log transfers between wallets and platforms. A transfer is not a disposal, but it is the event that separates an asset from the broker who knows its basis. Untracked transfers are the single biggest cause of missing-basis problems.
  3. Treat every swap as a transaction, not as housekeeping. Date, what went out, what came in, and the value at the time.

Then, when the forms arrive:

  • Reconcile each 1099-DA against your own records rather than adopting its figures.
  • Check whether basis is present. If it is absent, that is your cue to supply it, not a signal that the sale is untaxed.
  • Flag anything you cannot evidence for your tax professional early, while there is still time to go looking for old records.

The form tells the IRS what you sold for. Only your records can say what it cost you.

Track it now. Thank yourself in April.

Common questions

What is Form 1099-DA?
The IRS describes it as the form used to report digital asset proceeds from broker transactions. The reporting requirements apply to sales a broker has effected for customers after 2025.
Does Form 1099-DA show my cost basis?
Sometimes. The instructions state that for sales effected after 2025 of digital assets that are covered securities, "the broker is required to report basis information", and that for noncovered securities "the broker is not required to report basis information. However, the broker may voluntarily report this information."
What do I do if basis is missing from the form?
Supply it from your own records. A missing basis does not mean a basis of zero, but you have to be able to evidence what you actually paid — which is why acquisition records matter most for assets a broker never saw.
Is swapping one coin for another taxable?
The IRS lists disposing of a digital asset "for another digital asset" among the transactions that require a Yes answer to the Form 1040 digital assets question. No dollars need to move for a disposal to have happened.
Do I report crypto if I made no money?
Yes. The IRS states: "If you have digital asset transactions, you must report them whether or not they result in a taxable gain or loss."
What exactly does the Form 1040 question ask?
"At any time during the tax year, did you: (a) receive (as a reward, award or payment for property or services); or (b) sell, exchange, or otherwise dispose of a digital asset (or a financial interest in a digital asset)?"
Is mining or staking income?
The IRS lists receiving digital assets from "mining, staking and similar activities" among the events requiring a Yes answer. Treatment then depends on your facts, so take the specifics to a qualified tax professional.

This article is for educational purposes only and does not constitute tax, legal, or financial advice. Consult a qualified tax professional about your situation.

Official sources