Form 1099-DA: Crypto Broker Reporting Explained

Form 1099-DA is the information return that US crypto exchanges and other digital asset brokers use to report your sales and exchanges of digital assets to the IRS. The first forms covered 2025 sales and showed gross proceeds only; for sales from 2026 onward, brokers must also report cost basis for assets you bought in that account after 2025. If you sell, swap or spend crypto through a custodial platform, expect a Form 1099-DA and plan to reconcile it with your own records.

For freelancers and small businesses that take crypto from clients, the form matters twice: once when you receive crypto as income, which the 1099-DA does not report, and again when you sell it, which it does. This guide explains who files the form, what each box means, the stablecoin and NFT thresholds, and how to carry the numbers to Form 8949 without double-counting income. It is general information, not tax advice; check your situation with a tax professional.

What is Form 1099-DA?

Form 1099-DA, Digital Asset Proceeds From Broker Transactions, was created by Treasury regulations that apply the broker reporting rules long used for stocks (Form 1099-B) to digital assets. Under the IRS instructions for Form 1099-DA, a broker reports sales it effects for customers, which includes disposing of a digital asset for cash, for another digital asset, for a stored-value card, or as payment for broker services.

Generally only US digital asset brokers that take custody of customer assets must file. That covers centralized exchanges, hosted wallet providers that execute trades, digital asset kiosks and certain payment processors. In April 2025, Congress used the Congressional Review Act to repeal the separate rule that would have treated many decentralized finance (DeFi) front ends as brokers, so purely on-chain swaps from a self-custody wallet generally do not produce a Form 1099-DA. They are still taxable and you still report them.

The rollout timeline

Sales made in	What the broker reports	Form arrives
2025	Gross proceeds; basis not required	Early 2026
2026 and later	Gross proceeds, plus cost basis for covered assets (acquired after 2025 in the same custodial account)	Early 2027 and each year after
Any year, noncovered assets	Gross proceeds; basis optional (box 9 checked if voluntarily reported)	With the regular form

Who gets a Form 1099-DA, and who does not

You should expect a form if you sold, converted or traded digital assets on a US custodial platform during the year, unless a de minimis rule applies. You will usually not receive one for:

• Crypto received as payment for work. A client paying your invoice in USDC or Bitcoin is income to you, not a sale. If you use a processor, it may send you a Form 1099-K instead, depending on its own reporting thresholds.
• Staking and other rewards. The instructions state that rewards and staking payments are not reported on Form 1099-DA. They are still ordinary income when you gain control of them.
• Transfers between your own wallets. Moving coins from an exchange to your hardware wallet is not a sale. The broker may record transfer-in dates (boxes 12a and 12b) when assets arrive.
• Self-custody DeFi activity. Software that only lets you control your own private keys is not treated as a broker.

Stablecoin, NFT and payment processor thresholds

To avoid millions of tiny forms, the rules include optional methods and de minimis thresholds. Brokers may choose whether to use the optional methods, so two exchanges can treat the same activity differently.

Asset or activity	Threshold per customer per year	Effect
Qualifying stablecoins (optional method)	$10,000 aggregate gross proceeds	No reporting of designated sales at or below the threshold; above it, aggregate reporting
Specified NFTs (optional method)	$600 aggregate gross proceeds	No reporting at or below the threshold
Processor digital asset payment (PDAP) sales	$600	No reporting at or below; above it, all such sales are reported

These thresholds only switch off the broker's reporting. Your gains and losses remain taxable, which matters if you take stablecoin invoice payments and convert them in many small batches.

Form 1099-DA boxes explained

The form is organized around individual transactions. The boxes you will look at most:

Box	What it shows	Why it matters
1a-1c	Token identifier, asset name, number of units	Matches the transaction to your records
1d / 1e	Date acquired / date sold	Determines short-term vs long-term
1f	Gross proceeds	The sale amount for Form 8949 column (d)
1g	Cost or other basis	Only required for covered assets
1i	Wash sale loss disallowed	Rarely used for crypto; check if present
2	Basis reported to IRS	Decides which Form 8949 box you check
4	Federal income tax withheld	Backup withholding, claimed as a payment
9	Noncovered security	Basis was voluntary or missing
11a-11c	Optional-method details	Aggregate stablecoin or NFT reporting
12a-12b	Units and date transferred in	Flags assets moved in from elsewhere

How to use Form 1099-DA on your tax return

1. Collect every form. Download 1099-DA statements from each exchange, plus any 1099-K, 1099-MISC or 1099-NEC from processors and clients.
2. Pull your own transaction history. Export CSVs from every exchange and wallet, including the ones that did not issue a form.
3. Reconcile proceeds. Make sure each sale on the 1099-DA appears in your records and that totals match.
4. Fill in missing basis. For noncovered assets, use your purchase records or the dollar value on the date you received crypto as payment.
5. Sort by box. On the 2025 and later Form 8949, digital assets use boxes G, H and I (short-term) and J, K and L (long-term). Our guide to Form 8949 explains each one.
6. Carry totals to Schedule D and answer the digital asset question on page 1 of Form 1040.

Worked example: a freelancer paid in crypto

This example is illustrative. A web developer invoices a client $4,000 and accepts payment in USDC on March 10, 2026. On the same day she receives 0.05 BTC worth $3,000 for a second project. Both amounts, $7,000 in total, are business income on Schedule C and are subject to self-employment tax via Schedule SE.

In September she sells the 0.05 BTC on the same exchange for $3,600 and converts the USDC to dollars at $4,000. Her early-2027 Form 1099-DA shows:

• BTC sale: proceeds $3,600. If the BTC was received into her account after 2025 and the exchange tracked it as an acquisition, basis of $3,000 may be reported. If it was transferred in from a personal wallet, basis is likely blank.
• USDC: $4,000 of qualifying stablecoin sales, at or under $10,000, so the exchange may not report them at all under the optional method.

Her tax result: a $600 short-term capital gain on the BTC and zero gain on the USDC. She does not report the $3,000 again as a gain; the income was already taxed on Schedule C, and that $3,000 is her basis. The invoices she issued are her evidence of the value on the day of receipt.

Common mistakes with Form 1099-DA

• Treating gross proceeds as profit. Without basis, the form can make it look as if the entire sale is gain. Always enter your real basis.
• Double-counting crypto income. Crypto received for services is taxed once as income; only the later change in value is a capital gain or loss.
• Ignoring transfers. Moving coins between exchanges breaks the broker's basis chain. Keep a record of where each lot came from.
• Assuming no form means no tax. DeFi swaps, foreign exchanges and small stablecoin sales may never appear on a form but are still reportable.
• Mixing business and personal wallets. A separate wallet or exchange account for client payments makes reconciliation far easier.

What to do if you received a 1099-DA you did not expect

If a form shows sales you do not recognize, log in and check the account's trade history, auto-convert settings and card spending (spending crypto with a card is a sale). If the form is wrong, ask the broker for a corrected 1099-DA. If you already filed and later discover a missing form, you may need an amended return on Form 1040-X. The IRS matches information returns to tax returns automatically, so unreported proceeds usually lead to a CP2000 notice proposing tax on the full proceeds.

Recordkeeping that makes 1099-DA season easy

The broker sees only part of your activity. Your own records fill the gaps:

• Every invoice paid in crypto, showing the dollar amount, the token, the network and the transaction hash.
• Exchange and wallet exports for each year, saved as files rather than relying on a platform that might close.
• A lot-tracking spreadsheet or crypto tax software that assigns basis per wallet, which the IRS has required since 2025 rather than the older universal method.
• Retention for at least as long as the IRS can audit; see how long to keep invoices and records.

If you are still deciding whether to accept digital payments at all, our guide on how to accept crypto payments compares processors and self-custody, and the 2026 1099-NEC threshold post explains what clients report when they pay you.

Form 1099-DA compared with other 1099 forms

Form	Filed by	Reports
1099-DA	Digital asset brokers	Sales and exchanges of digital assets
1099-B	Securities brokers	Sales of stocks, bonds and similar
1099-K	Payment settlement entities	Gross payments received for goods and services
1099-NEC	Businesses paying contractors	Nonemployee compensation ($2,000 threshold for 2026 payments)
1099-MISC	Payers of other income	Rewards, prizes and other income in some cases

Clear invoices are the backbone of crypto recordkeeping: they prove what you were paid, when and in what token, which sets your basis for every later sale. Create professional invoices that state the dollar amount and the accepted token with our free invoice generator, with no sign-up required, and download each one as a PDF for your tax files.