Crypto tax reporting changed substantially starting tax year 2025 (filed in 2026). Form 1099-DA, the new IRS form specifically for digital asset transactions, became mandatory for US-regulated crypto brokers. Coinbase, Kraken, Gemini, Crypto.com, and other regulated US platforms must report user transactions to IRS using 1099-DA structure. Users receive same data on their copies for tax filing.
The mandatory reporting fundamentally changes crypto tax compliance landscape. Pre-2025, exchanges sent inconsistent or no tax documentation. Some sent 1099-MISC, some sent 1099-K, most sent transaction history reports. Users had to compile and reconcile across platforms. Now exchanges send standardized 1099-DA matching IRS expectations.
But "standardized" doesn't mean "identical implementation." Each exchange handles 1099-DA slightly differently. What's reported, when it's reported, what's not reported, what cost basis assumptions get applied — all vary across platforms.
This piece walks through specific implementation differences across major US crypto exchanges, what 1099-DA actually contains, what it doesn't contain, and what users still need to track manually for accurate tax filing.
What 1099-DA Actually Contains
The 1099-DA form structure (per IRS specification):
Gross proceeds from sales transactions during tax year.
Cost basis for assets where exchange has cost basis information.
Realized gain/loss calculated by exchange where possible.
Holding period (long-term vs short-term).
Specific transaction details (date acquired, date sold, asset type).
Wash sale adjustments where applicable.
Federal income tax withholding if applicable.
The form structure mirrors 1099-B used for traditional securities but with crypto-specific fields. Forms are sent to user (Form 1099-DA copy) and IRS (informational copy) by deadline (typically end of February for prior tax year).
Coinbase Implementation
Coinbase's 1099-DA implementation:
Reports all sale transactions on Coinbase platform during tax year. Includes sales of Bitcoin, Ethereum, all altcoins traded on Coinbase. Includes conversions between cryptocurrencies (treated as sale + purchase).
Cost basis reported for assets purchased on Coinbase. Cost basis NOT reported for assets transferred in from external wallets or other exchanges. User responsible for tracking external cost basis.
Default accounting method: FIFO (First In First Out). Specific lot identification possible but requires user opt-in setup.
Staking rewards reported separately as ordinary income on appropriate forms. Staking complexity handled.
NFT transactions reported. Complexity around NFT cost basis varies.
Coinbase Pro / Advanced Trade transactions consolidated into main 1099-DA. Subaccount activities aggregated.
Tax season communications: Coinbase typically issues 1099-DA in late January / early February for prior tax year. Users access through tax document section in account.
Specific Coinbase quirks:
Coinbase Earn rewards reported as ordinary income but tax timing can be complicated.
Coinbase Card crypto rewards have specific tax treatment that may not be fully captured.
Coinbase Custody activities for institutional users have separate reporting.
Kraken Implementation
Kraken's 1099-DA implementation:
Reports US-customer sale transactions during tax year. Includes spot, futures (where applicable), staking transactions.
Cost basis reporting similar to Coinbase. Internal Kraken purchases tracked. External transfers require user-provided cost basis.
Default accounting method: FIFO. Different lot identification methods available with operational setup.
Kraken Pro consolidated into main 1099-DA reporting.
Staking rewards (specific to allowed jurisdictions; Kraken removed staking for US users in 2023, then partially restored under new structure) handled per current regulatory framework.
Specific Kraken quirks:
Kraken Margin trading has specific tax implications captured in 1099-DA.
Kraken Futures has separate reporting structure if used.
International users have different reporting requirements; this discussion applies to US users specifically.
Gemini Implementation
Gemini's 1099-DA implementation:
Reports US-customer transactions on Gemini exchange. Spot trading, Earn (where available), specific Gemini products.
Cost basis tracked for internal Gemini purchases. External transfers require user-provided basis.
Gemini's institutional positioning means specific institutional account types have different reporting structures.
Gemini Custody activities have separate reporting framework.
NFT transactions on Gemini's NFT platform (formerly Nifty Gateway) reported.
Specific Gemini quirks:
Gemini's compliance-focused positioning means typically clean and accurate 1099-DA implementation.
Gemini Earn (if and when available) has specific income reporting mechanics.
Gemini Pay activities have specific transaction reporting.
Crypto.com Implementation
Crypto.com's 1099-DA implementation:
Reports US-customer transactions. Crypto.com has narrower service availability for US users than international users.
Cost basis tracking for internal Crypto.com Exchange purchases.
Crypto.com Card transaction reporting handled.
CRO staking rewards reporting.
Specific Crypto.com quirks:
Crypto.com Card crypto cashback has specific tax treatment that may not be fully captured.
Specific service availability varies by US state.
Conversions between crypto and CRO for staking tier maintenance have tax implications.
What 1099-DA Doesn't Cover
Critical gaps in 1099-DA reporting that users must handle separately:
DeFi transactions on decentralized protocols. Aave, Uniswap, Curve, GMX, Hyperliquid, all DeFi positions don't generate 1099-DA. Users responsible for tracking and reporting all DeFi activity.
Self-custody wallet transactions. Bitcoin, Ethereum, etc. sent between user's own wallets or to third-party recipients don't generate 1099-DA.
Cross-platform transfers. Moving crypto from Coinbase to Kraken doesn't generate transaction reporting (it's transfer not sale) but cost basis tracking still matters.
International exchange activity. Non-US exchanges (Binance international, Bybit, OKX) typically don't issue 1099-DA. Users with international exchange activity must track separately.
NFT transactions on non-US platforms. OpenSea, Magic Eden, various NFT marketplaces have inconsistent tax reporting.
Mining income. Self-mining doesn't generate 1099-DA. Mining pool activity may or may not depending on pool structure.
Airdrops, hard forks, certain reward distributions. Specific tax treatment that exchanges may not fully capture.
What This Means For Filing
For users with all crypto activity on US-regulated exchanges:
1099-DA reporting substantially simplifies tax filing. Forms map cleanly to standard tax return preparation.
Verify 1099-DA accuracy before filing. Specific transaction patterns might not be reported correctly; review carefully.
Address gaps proactively. If exchange didn't report cost basis for transferred-in assets, calculate manually.
For users with mixed activity (US exchanges plus DeFi plus international plus self-custody):
1099-DA covers only US exchange portion. Substantial manual tracking needed for everything else.
Specialized crypto tax software (Koinly, CoinTracker, CoinLedger, TokenTax, others) helps consolidate across sources.
Reconciliation between 1099-DA reports and software-calculated reports critical to catch errors.
For users with substantial DeFi activity:
1099-DA only relevant for the small US exchange portion of activity. Most tax preparation requires DeFi-specific tools.
DeFi tax complexity (liquidity provision, yield farming, leveraged positions, IL calculations) much harder than spot exchange tax.
Working with crypto-specialized CPA highly recommended for substantial DeFi activity.
Common Filing Mistakes To Avoid
Specific mistakes I see users make with 1099-DA filing:
Trusting 1099-DA cost basis without verification. Exchange-reported cost basis can be wrong, especially for transferred-in assets.
Missing transactions outside 1099-DA scope. DeFi, self-custody transfers, international exchange activity all need separate tracking.
Wash sale considerations for crypto. Crypto wash sale rules are complicated and inconsistently applied.
Holding period calculation errors for transferred assets. Holding period applies to original acquisition, not exchange entry date.
Staking reward timing errors. Staking rewards taxed when received and controlled, not when sold.
NFT cost basis errors. NFT acquisition costs (gas, marketplace fees) may not be fully captured in basic 1099-DA.
Hard fork and airdrop treatment. Specific tax treatment varies and may not be captured automatically.
For tax-complex situations, professional tax preparation pays for itself through avoiding costly mistakes.
My Filing Approach
For my own crypto tax filing:
Track everything in centralized crypto tax software (specifically Koinly currently, though others work similarly). Pulls in 1099-DA data plus DeFi activity plus self-custody wallet transactions.
Verify software calculations against 1099-DA exchange reports. Catch discrepancies before filing.
Work with crypto-specialized CPA for review and complex situation handling. Worth the cost for substantial activity.
File extension if needed for complex tax situations. Better to file correctly later than incorrectly on time.
For users with simple situations (single US exchange, no DeFi), basic tax preparation may suffice. For complex situations, specialized crypto tax preparation strongly recommended.
The 1099-DA mechanism improves crypto tax compliance landscape substantially but doesn't solve crypto tax complexity entirely. Substantial tracking work remains for users with diverse crypto activity.
A few sourcing notes: 1099-DA structure from IRS guidance and form specifications through April 2026. Specific exchange implementations from public exchange tax documentation. Exchange-specific quirks from user community reports and official exchange communications. This is general educational content not specific tax advice. Crypto tax situations vary substantially across users; consult qualified tax professional for specific situation guidance.