A survey of US crypto investors has found that about one in five who filed or planned to file a tax extension received an incomplete 1099-DA or were unsure whether the form matched their trades.
Awaken Tax’s August survey found that another 21% of respondents who had filed, or planned to file, an extension were still waiting for information from an exchange or crypto platform. The findings concern a group of taxpayers trying to finish 2025 returns during the first filing season for Form 1099-DA, which brokers use to report certain digital asset transactions to the Internal Revenue Service.
The IRS says brokers generally had to report gross proceeds from covered 2025 transactions. Proceeds show what a customer received in a sale, but most forms for that tax year do not show what the customer originally paid. Taxpayers need both figures to calculate a gain or loss, and the agency says they must report digital asset income, gains, and losses even if no 1099-DA arrives.
Crypto tax forms can show a sale without its cost
For a taxpayer who bought Bitcoin for $9,000 and sold it for $10,000, the gain would be $1,000 before any applicable adjustments. A 2025 Form 1099-DA could report the $10,000 in proceeds without listing the $9,000 purchase price.
Chris Herbst, managing director of CountDeFi tax reporting, said gross proceeds can be many times an active trader’s actual gain because the form counts each sale at its full value without subtracting the asset’s cost. Taxpayers must then match the reported sales with their own purchase records.
According to the IRS, taxpayers should use Form 1099-DA together with their other records and calculate their basis before filing. Someone who bought an asset on one exchange, moved it through a private wallet and sold it on another may need records from all three places to establish what they paid.
Herbst said a complete exchange history should include trades, fees, deposits, withdrawals, and transaction identifiers. A missing record can affect a later calculation when an asset has moved between platforms or remained in a wallet for years.
In its earlier guide to 1099-DA, crypto.news reported that brokers had to send forms covering 2025 gross proceeds by Feb. 17, 2026, while reporting cost basis remained voluntary for that first year. The IRS had warned taxpayers that most of the statements would leave them to calculate basis themselves.
Exchange records are proving hard to reconcile
Sharon Yip, founder of Crypto Tax Advisors, said her firm has found differences between clients’ 1099-DAs and the tax reports it prepared from their transaction histories. Some exchange forms omitted trades made in 2025, while customer statements arrived in different formats. Exchanges also included cost basis for some trades but left it off others, she said.
One client’s exchange activity included more than $300,000 in stablecoin trades during 2025, according to Yip. The exchange’s 1099-DA listed less than $100,000 in total stablecoin proceeds. The discrepancy left her firm comparing the form against the client’s transaction records to work out what should appear on the return.
Andrew Duca, founder of Awaken Tax, said some customers received their forms late in the filing season. He cited Kraken as an example, saying the exchange sent forms to users roughly two weeks before the April 15 tax deadline. Duca also pointed to a Kraken 1099-DA from around that period that contained no reported transaction information.
Under IRS guidance for incorrect forms, recipients can request a corrected 1099-DA from the issuer and keep both the corrected form and their correspondence. The agency says taxpayers should not wait for a correction before filing and should use their records to report the transactions accurately.
Duca urged taxpayers to compare any 1099-DA with their complete transaction history rather than copy its figures into a return. “The IRS expects your return to reflect your actual gains and losses,” he said, “not necessarily what’s printed on a form that the exchange may have worked out incorrectly.”
Manual entries add work before the October deadline
Andrew Gordon, executive director of Digital Asset Tax Action, said taxpayers have repeatedly struggled to reconcile 1099-DAs with their own records this filing season. According to Gordon, most crypto tax software cannot import and reconcile the new form, while the tools that can still require manual input because brokers did not supply machine-readable 2025 forms.
For active traders, that can mean entering hundreds of transactions, Gordon said. He called for brokers to provide a machine-readable file with each 1099-DA and maintain histories that show acquisition dates, purchase amounts, fees and transfers.
The IRS extension guidance gives taxpayers who obtained an extension until Oct. 15 to file their 2025 federal return. The extension applies to filing; any balance due was generally payable by the original deadline.
Crypto tax recordkeeping has also drawn attention in Congress. In September, House crypto tax legislation included a proposed exemption for certain network transaction fees of up to $10.
During an earlier House Ways and Means hearing, Coinbase tax executive Lawrence Zlatkin told lawmakers that calculating gains and losses on routine stablecoin payments and blockchain fees creates substantial compliance work. The proposal has not changed the filing rules for 2025 returns.
Which crypto sales get basis reporting in 2026?
The next stage of Form 1099-DA reporting applies to transactions made in 2026. Under IRS instructions for brokers, basis reporting is mandatory for certain covered assets bought in a custodial broker account after 2025 and held there until sale. Reporting basis for noncovered assets remains voluntary.
The IRS classifies assets acquired before 2026 and assets transferred into a broker from elsewhere as noncovered for this purpose. Its instructions also allow certain stablecoin and NFT sales to be reported using optional methods that do not require basis. For those transactions, taxpayers may still need purchase and transfer records from outside the selling broker’s account to calculate their gains or losses.
