2026

Form

<p><img width="1536" height="1024" src="https://financefeeds.com/wp-content/uploads/2026/04/What-Cost-Basis-in-Crypto-Means-for-Taxes-and-Profits.jpg" alt="IRS Form 1099-DA crypto tax reporting 2026 — what Coinbase trades now reveal and how to reconcile cost basis" title="Your Coinbase Trades Now Go to the IRS — What 1099-DA Changes 142"></p>
<p>If you traded crypto on Coinbase, Kraken, Robinhood, or any centralised US exchange in 2025, the IRS now has those records. Starting January 1, 2026, every US centralised exchange is required to file <strong>Form 1099-DA</strong> for each customer — and the first batch of those forms is hitting taxpayer accounts in May. For the first time, your broker is reporting your crypto proceeds directly to the IRS, line-by-line. That changes the audit equation, the reporting workflow, and the back-tax exposure for anyone who has under-reported.</p>
<p>The form is not new in concept — it mirrors the 1099-B used for stock proceeds — but the data volume is. <a href="https://koinly.io/guides/crypto-taxes/" rel="noopener noreferrer nofollow">Estimates from CoinLedger and Koinly</a> put the number of newly reportable disposals at over 200 million for the 2025 tax year, more than ten times what was visible under self-reporting.</p>
<h2 id="what-1099-da-actually-reports">What 1099-DA actually reports</h2>
<p>For each crypto sale, swap, or disposal in 2025, your exchange reports four data points: gross proceeds, the asset disposed of, the disposal date, and (for transactions that took place after the cost-basis-reporting effective date) your cost basis. Cost basis reporting is being phased in — the 2025 forms include gross proceeds only; the 2026 tax year (filed in 2027) will include cost basis. That phase-in is critical because gross-proceeds-only reporting will trigger IRS notices for anyone whose net-of-cost gain is materially smaller than the gross number.</p>
<p>The form is filed to the IRS and a copy is sent to you. If your exchange and your tax return don't match, the IRS computer matching system flags it within weeks of filing season. <a href="https://financefeeds.com/is-turbotax-worth-using-if-you-traded-crypto/" rel="noopener noreferrer nofollow">FinanceFeeds covered TurboTax's crypto workflow</a> in detail earlier this year — the short version is that consumer tax software now imports 1099-DA data directly, but you still need to reconcile cost basis manually for any 2025 disposals.</p>
<h2 id="what-this-means-for-your-tax-return">What this means for your tax return</h2>
<p>If you held crypto on a single US exchange with clean records, the impact is mostly procedural — data flows from exchange → IRS → your return automatically. If you used multiple exchanges, self-custody, or DEX trading, the impact is materially larger. Your CEX sends gross proceeds without cost basis; you're responsible for reconstructing it from your transaction history.</p>
<p>The worst-case scenario is for users who moved crypto between exchanges before disposing. The 1099-DA reports the disposal from the second exchange but not the original purchase — from the IRS's perspective, it can look like you sold $50,000 of BTC with zero cost basis. Correct it on Form 8949, but you'll need transfer records, not just trade records.</p>
<h2 id="the-action-steps-you-cannot-skip">The action steps you cannot skip</h2>
<p>Three items. First, download a full 2025 transaction history from every exchange you used — gross proceeds, asset, dates. Export windows shrink after 18 months. Second, reconcile cost basis via CoinLedger or Koinly (which aggregate across venues), or TurboTax Premier for one or two venues. Third, file Form 8949 with corrected cost basis attached to the broker 1099-DA figure. <a href="https://financefeeds.com/turning-crypto-losses-into-lessons/" rel="noopener noreferrer nofollow">If you have 2025 losses</a> — Luna, FTT, rug pulls, worthless tokens — claim them on Schedule D to offset gains.</p>
<h2 id="what-this-changes-for-self-custody-users">What this changes for self-custody users</h2>
<p>Self-custody wallets — MetaMask, Phantom, Ledger, Trezor — do not file 1099-DA. The reporting requirement is on centralised brokers only. But the moment you move crypto from a CEX to a self-custody wallet and back, the CEX is still required to report the eventual disposal, and you're still required to reconstruct the cost basis. The privacy advantage of self-custody is real, but the tax-reporting advantage is small and shrinking. <a href="https://financefeeds.com/schwab-crypto-just-launched-should-you-move-btc-from-coinbase/" rel="noopener noreferrer nofollow">Schwab Crypto's recent launch</a> goes further in the opposite direction — fully custodial holding inside the same brokerage you already file taxes from, which collapses the reconciliation step entirely.</p>
<p>The structural takeaway: 1099-DA is the moment crypto becomes operationally equivalent to stocks for tax-reporting. The audit risk for casual users is now mostly mechanical — keep records, reconcile, file on time. The risk for active traders is higher mostly because the IRS now has the visibility it always lacked. Download your 2025 transaction history before the end of June; reconcile cost basis in July; file by the October extension.</p>

Your Coinbase Trades Now Go to the IRS — What 1099-DA…

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