Glossary / Regulation & tax
Form 1099-DA
- Definition
- Form 1099-DA is the US tax form on which a custodial broker reports your digital asset sales to the IRS and to you, starting with the 2025 tax year.
It is the digital asset counterpart of the 1099-B a stockbroker already sends. Treasury finalized the rules in T.D. 10000, published July 9, 2024: gross proceeds are reported for sales on or after January 1, 2025, and cost basis is added for units acquired on or after January 1, 2026. If you sell bitcoin on a US platform, the IRS receives a copy whether or not you file.
How it works
Form 1099-DA reports transactions, not tax owed. A broker sends one copy to the IRS and one to you covering each sale, exchange, or other disposal it processed during the year: the date, the number of units, the gross proceeds, and, once basis reporting begins, what you originally paid.
The word broker is narrower than the first draft of the rules suggested. It covers custodial trading platforms, hosted wallet providers that carry out sales, and certain payment processors. A separate regulation that would have pulled decentralized exchange front ends into the same definition was repealed under the Congressional Review Act, signed into law on April 10, 2025, so a swap on a decentralized venue, a peer-to-peer trade, or a transfer between your own wallets produces no form at all. None of that removes your obligation to report the gain yourself.
Basis is the messy part. A platform only knows your purchase price if you bought there. Coins you moved in from somewhere else arrive with no price attached, so the proceeds line can look like pure profit. Revenue Procedure 2024-28 forced a cleanup ahead of the switch: holders had to allocate unused basis to specific wallets and accounts as of January 1, 2025, instead of keeping one universal pool and picking lots afterwards.
Where you see it
Form 1099-DA arrives in the filing season after the sale, alongside your other 1099s. You do not attach it to the return. Its figures feed Form 8949 and Schedule D, where you subtract basis, apply the holding period, and reach the number the tax is actually computed on.
Expect mismatches, and plan to explain them. Moving coins to a hardware wallet is not a sale, but a platform that only sees them leave has limited information about what happened next. A platform that never knew your purchase price reports proceeds with an empty cost column, which reads as a 100 percent gain until you supply the missing figure. Because the IRS matches reported proceeds against your return by computer, a difference you never reconcile turns into an automated notice rather than an argument.
One more line worth knowing: if the broker holds no valid taxpayer identification number for you, backup withholding applies at 24 percent of gross proceeds, taken before the money reaches your bank.
Form 1099-DA vs capital gains tax
Form 1099-DA is a report; capital gains tax is the liability it feeds. The form states what left your account and for how much, and it says nothing about whether you made money: a 5,000 dollar sale of coins that cost you 6,000 dollars is 5,000 dollars of proceeds on the form and a loss on your return. The reverse trap is more expensive. Receiving no form does not make a disposal invisible or untaxed, because a peer-to-peer sale, a swap, or spending bitcoin on goods is still a taxable event in the US. A missing 1099-DA is a gap in what the IRS was told, not a gap in what you owe.