1099-DA Filing Guide 2026: Your Crypto Tax Form Arrives Feb 17 — Fix the $0 Cost Basis Before You File

✍️ Written by Davit Cho

Crypto Tax Specialist & CEO at JejuPanaTek

13+ Years Experience | Patent #10-1998821 | IRS Compliance Expert

davitchh@proton.me

Published: February 14, 2026  |  Last Updated: February 14, 2026

Your Form 1099-DA is arriving this week — and it's unlike any crypto tax form you've seen before. For the first time in history, the IRS is receiving transaction-level data from every major U.S. crypto exchange: Coinbase, Kraken, Gemini, Robinhood, PayPal, and more.

The deadline for brokers to deliver your 1099-DA is February 17, 2026. But here's the problem: for 2025 transactions, this form reports only gross proceeds — not cost basis. That means the IRS sees every dollar you received from selling crypto as pure profit — unless you correct it yourself.

This guide walks you through exactly what the 1099-DA is, what's missing, how much it could cost you, and the step-by-step process to file correctly before April 15.

⚠️ 1099-DA DEADLINE: FEBRUARY 17, 2026 — 3 DAYS LEFT

⚡ Quick Facts — 1099-DA Filing 2026

• Form: 1099-DA (Digital Asset) — brand new for 2025 tax year
• Broker Deadline: February 17, 2026
• What's Reported to IRS: Gross proceeds only (no cost basis for 2025)
• Cost Basis Reporting: Starts for 2026 transactions (covered assets only)
• Your Filing Deadline: April 15, 2026 (or Oct 15 with extension)
• Key Form: Form 8949 + Schedule D
• IRS Relief: Notice 2025-7 — you CAN report your own cost basis
• Default Method: FIFO unless you elect Specific Identification
• Risk if Unfixed: IRS treats $0 basis = 100% taxable gain

📋 Table of Contents

1. What Is Form 1099-DA?
2. What's Reported — and What's Dangerously Missing
3. The $0 Cost Basis Trap (With Dollar Examples)
4. Notice 2025-7: The IRS Relief You Must Know
5. Form 8949: Where Every Crypto Trade Goes
6. Exchange Comparison: Coinbase vs Kraken vs Gemini vs Robinhood
7. Per-Wallet Cost Basis: The Rule That Complicates Everything
8. 7-Step Filing Action Plan
9. FAQ: 15 Questions

1. What Is Form 1099-DA?

Form 1099-DA is the crypto equivalent of the 1099-B that stock brokers have been sending for decades. It's an informational tax form issued by U.S. digital asset brokers — including centralized exchanges like Coinbase, Kraken, and Gemini — to report taxable digital asset disposals to both you and the IRS.

This form exists because of the 2021 Infrastructure Investment and Jobs Act, which required crypto brokers to adopt the same reporting framework as traditional securities. After years of delays and rulemaking, 2025 is the first tax year it's in effect.

Feature	1099-DA (Crypto)	1099-B (Stocks)
First Year	2025 tax year	Decades
Issued By	Crypto exchanges (CEX)	Stock brokers
Reports Proceeds	✅ Yes	✅ Yes
Reports Cost Basis	❌ Not for 2025	✅ Yes (covered securities)
Covers DeFi/DEX	❌ No	N/A
Covers Transfers	❌ No	✅ Broker-to-broker
Filed Per	Per transaction to IRS; consolidated to you	Consolidated

⚠️ Critical Distinction: The 1099-DA is an informational form — it does NOT determine your tax owed. It does NOT replace Form 8949. It is the starting point, not the final answer. Relying on it alone without reconciling cost basis is how people accidentally overpay thousands in tax.

2. What's Reported — and What's Dangerously Missing

✅ What IS on the 1099-DA

Field	2025 Transactions	2026+ Transactions
Date of sale/disposition	✅ Reported	✅ Reported
Gross proceeds	✅ Reported	✅ Reported
Asset type (BTC, ETH, etc.)	✅ Reported	✅ Reported
Number of units	✅ Reported	✅ Reported
Cost basis	❌ NOT reported to IRS	✅ Covered assets only
Gain/loss calculation	❌ NOT reported	❌ Partial
Date acquired	❌ Often missing	✅ Covered assets

❌ What is NOT on the 1099-DA

This is where most people get blindsided. The following taxable activities are completely absent from the 1099-DA:

Activity	On 1099-DA?	Still Taxable?
Crypto transferred IN from another exchange/wallet	❌ Shows $0 basis	✅ Yes — you must report
DeFi trades (Uniswap, Aave, Curve, etc.)	❌ Not included	✅ Yes
DEX trades (Jupiter, PancakeSwap, etc.)	❌ Not included	✅ Yes
Staking rewards	❌ (on 1099-MISC if >$600)	✅ Ordinary income
Mining income	❌ Not included	✅ Ordinary income
Airdrops	❌ Not included	✅ Ordinary income at FMV
Crypto received as payment	❌ Not included	✅ Ordinary income
NFT sales under $600	❌ Threshold exemption	✅ Yes
Stablecoin sales under $10,000	❌ Threshold exemption	✅ Yes (if gain exists)
Wrapping/unwrapping (ETH→WETH)	❌ Not included	⚠️ Possibly

⚠️ Just because it's not on the 1099-DA doesn't mean it's not taxable. You are still required to report ALL taxable disposals on Form 8949 — exactly as you have in prior years. The 1099-DA is additional reporting, not a replacement.

3. The $0 Cost Basis Trap (With Dollar Examples)

This is the single most expensive mistake you can make this tax season. Here's a real-world example:

You sold 1 BTC on Coinbase in 2025 for $66,000. Here's what happens depending on how cost basis is handled:

Scenario	Cost Basis	Taxable Result	Tax @ 24%
🔴 1099-DA only (no basis)	$0	+$66,000 gain	$15,840
🟡 FIFO default (bought $35K in 2021)	$35,000	+$31,000 gain	$7,440
🟢 Specific ID (bought $97K in 2024)	$97,000	−$31,000 loss	$0 (+ deduction)

$15,840 vs. $0 — Same sale. Same Coinbase account. The only difference: whether you report cost basis correctly.

Why Does This Happen?

For the 2025 tax year, brokers are only required to report gross proceeds to the IRS. Cost basis is NOT reported. Many taxpayer copies will show $0, "unknown", or simply leave the field blank.

If you import this into TurboTax, H&R Block, or hand it to your preparer without fixing the basis — the software calculates your gain as:

$66,000 proceeds − $0 basis = $66,000 taxable gain

That's $15,840 in tax on money you may have actually lost.

✅ Key Takeaway: Never file using only 1099-DA numbers. Always calculate your actual cost basis using purchase records or crypto tax software. Use Specific Identification to select the highest-cost lots first (HIFO strategy) to minimize gains or maximize deductible losses.

4. Notice 2025-7: The IRS Relief You Must Know

The IRS knows the 1099-DA system isn't perfect yet. That's why they issued Notice 2025-7 — providing temporary relief for the 2025 tax year.

What Notice 2025-7 Allows

Relief Provision	What It Means for You
Use your own lot identification	You can choose Specific ID (including HIFO) — not stuck with FIFO
Rely on your own records	Your purchase records / crypto tax software are valid cost basis sources
Override $0 basis on 1099-DA	You can report correct basis on Form 8949 even if the 1099-DA shows $0
Transition year flexibility	The IRS acknowledges brokers have incomplete data

✅ This relief is critical. Without it, taxpayers would be forced to accept $0 or "unknown" basis — which would result in billions in overtaxation across the crypto market. The IRS explicitly says: you are allowed and expected to report your own cost basis.

⚠️ This relief is temporary. Starting with 2026 transactions, brokers must report cost basis for "covered" digital assets. The window to use broad lot-identification flexibility may narrow. Act now while the rules favor taxpayers.

5. Form 8949: Where Every Crypto Trade Goes

The 1099-DA is what the exchange sends. Form 8949 is what YOU file. Every single crypto disposal — whether it appeared on a 1099-DA or not — must be reported here.

Which Box Do You Check?

Box	When to Use	Example
Box A	Short-term, basis reported to IRS on 1099-DA	N/A for 2025 (basis not reported yet)
Box B	Short-term, basis NOT reported to IRS	N/A for 2025
Box D	Long-term, basis reported to IRS on 1099-DA	N/A for 2025
Box E	Long-term, basis NOT reported to IRS	N/A for 2025
Box G	Short-term, reported on 1099-DA, basis reported to IRS	Future years (2026+)
Box H ⭐	Short-term, reported on 1099-DA, basis NOT reported to IRS	Most 2025 CEX trades
Box I ⭐	Short-term, NOT reported on any 1099	DeFi, DEX, wallet trades
Box K ⭐	Long-term, reported on 1099-DA, basis NOT reported to IRS	Most 2025 CEX trades (held >1 yr)
Box L ⭐	Long-term, NOT reported on any 1099	DeFi, DEX, wallet trades (held >1 yr)

✅ For 2025 filing, most crypto investors will use:
→ Box H or K for trades that appear on a 1099-DA (CEX trades)
→ Box I or L for everything else (DeFi, DEX, wallet-to-wallet, mining sales, airdrop sales)

Form 8949 Column Guide

Column	What to Enter
(a) Description	e.g., "1.0 BTC"
(b) Date acquired	Original purchase date
(c) Date sold	Sale/trade date
(d) Proceeds	Sale price (should match 1099-DA)
(e) Cost basis	YOUR calculated basis (not the $0 from 1099-DA)
(f) Adjustment code	Use code B if basis was not reported to IRS
(g) Adjustment amount	Difference between 1099-DA basis and your actual basis
(h) Gain or loss	(d) minus (e) plus/minus (g)

⚠️ If your proceeds don't match the 1099-DA: The IRS computer will flag the discrepancy. Always make sure Column (d) proceeds match what the exchange reported. Adjust cost basis in Column (e), not proceeds.

6. Exchange Comparison: Coinbase vs Kraken vs Gemini vs Robinhood

Not all 1099-DAs are created equal. Each exchange handles reporting differently. Here's what to expect:

Feature	Coinbase	Kraken	Gemini	Robinhood
Issues 1099-DA	✅ Yes	✅ Yes	✅ Yes	✅ Yes
Reports gross proceeds to IRS	✅	✅	✅	✅
Reports cost basis to IRS (2025)	❌ No	❌ No	❌ No	❌ No
Shows basis on taxpayer copy	⚠️ Partial	⚠️ Partial	⚠️ Partial	✅ More complete
Tracks transferred-in basis	❌	❌	❌	❌
Includes staking on 1099-DA	❌ (1099-MISC)	❌ (1099-MISC)	❌ (1099-MISC)	❌ (1099-MISC)
Includes DeFi/DEX	❌	❌	❌	❌
CSV export available	✅	✅	✅	✅
API for tax software	✅	✅	✅	⚠️ Limited
Delivery format	Consolidated PDF	Consolidated PDF	Consolidated PDF	Consolidated PDF
Expected delivery	By Feb 17	By Feb 17	By Feb 17	By Feb 17

✅ Key Insight: No single exchange gives you the full picture. If you used multiple platforms — or ever transferred crypto between them — you need crypto tax software to reconcile cost basis across all accounts. The 1099-DA from each exchange only covers what happened on that exchange.

PayPal & Cash App Users

PayPal and Cash App also issue 1099-DAs for 2025 crypto sales. PayPal's form may show $0 proceeds for certain conversions (e.g., crypto-to-crypto within PayPal). Don't assume $0 proceeds means $0 tax — verify every line against your transaction history.

7. Per-Wallet Cost Basis: The Rule That Complicates Everything

Starting January 1, 2025, the IRS banned the universal wallet method under Revenue Procedure 2024-28. This is the second major rule change hitting you this tax season — and it directly affects how you use your 1099-DA.

Before Jan 1, 2025	After Jan 1, 2025
Pool all BTC across wallets into one "universal" lot	Each wallet/exchange = separate tax account
Choose any lot from any wallet when selling	Can only select lots from the wallet where the sale happens
Flexible tax optimization across platforms	Must track basis per-wallet; FIFO default per wallet

How This Multiplies the 1099-DA Problem

Imagine you hold BTC on both Coinbase and Kraken:

Wallet	Purchase Price	Sale Price	FIFO Result
Coinbase (bought Jan 2024)	$97,000	$66,000	−$31,000 LOSS
Kraken (bought Mar 2021)	$23,000	$66,000	+$43,000 GAIN

Same asset (BTC). Same sale price ($66K). Completely different tax outcomes — a $31K deductible loss vs. a $43K taxable gain — depending on which wallet the sale occurs in.

And both 1099-DAs show $0 cost basis. So without correction, both sales look like $66,000 in pure profit to the IRS — that's $132,000 in phantom gains and over $31,680 in unnecessary tax.

📖 Complete Per-Wallet Migration Guide
Step-by-step walkthrough of Rev. Proc. 2024-28, lot allocation, and FIFO vs. Specific ID strategies Read the Full Per-Wallet Guide →

8. 7-Step Filing Action Plan

Step 1: Collect ALL 1099-DAs (By Feb 17)

Check every exchange you used in 2025: Coinbase, Kraken, Gemini, Robinhood, PayPal, Cash App, Crypto.com. Download each 1099-DA from your account's tax documents section. You should receive one per exchange.

Step 2: Export Full Transaction History from Each Exchange

The 1099-DA doesn't include everything. Download your complete CSV transaction history from each platform. This captures transfers, staking rewards, referral bonuses, and small trades that may fall below reporting thresholds but are still taxable.

Step 3: Gather All Non-Exchange Records

Collect records for: DeFi/DEX trades (Uniswap, Aave, Jupiter, etc.), wallet-to-wallet transfers, mining income, airdrops, staking rewards from non-custodial validators, crypto payments received, and gifts.

Step 4: Import Everything into Crypto Tax Software

Software	Per-Wallet Tracking	Spec ID / HIFO	8949 Generation	Starting Price
CoinTracker	✅	✅	✅	$59/yr
Koinly	✅	✅	✅	$49/yr
CoinLedger	✅	✅	✅	$49/yr
TaxBit	✅	✅	✅	Free (basic)
Awaken Tax	✅	✅	✅	$50/yr
Summ	✅	✅	✅	$45/yr

Step 5: Reconcile 1099-DA Proceeds with Software Output

Compare gross proceeds on each 1099-DA against your tax software's totals. They should match. If they don't, common reasons include: fee handling differences, stablecoin conversion rounding, crypto-to-crypto trade price discrepancies. Document any differences.

Step 6: Choose Your Accounting Method

Method	How It Works	Best For
FIFO (default)	First purchased = first sold	Rarely optimal — often triggers highest gains
LIFO	Last purchased = first sold	Better if recent buys were at higher prices
HIFO	Highest cost lot sold first	✅ Usually best — minimizes taxable gains
Specific ID	You choose which lot to sell	✅ Maximum control — requires documentation

✅ Pro Tip: HIFO (Highest In, First Out) is usually the most tax-efficient method. Under Notice 2025-7, you are explicitly allowed to use Specific Identification for 2025 transactions. Most crypto tax software can automatically apply HIFO across your portfolio.

Step 7: File Form 8949 + Schedule D

Generate Form 8949 from your crypto tax software. Use Box H/K for trades reported on 1099-DA and Box I/L for trades not reported on any 1099. Transfer totals to Schedule D. If you have more than 50 transactions, attach the 8949 as a supporting PDF — TurboTax, H&R Block, FreeTaxUSA, and TaxAct all accept crypto tax software imports.

⚠️ Filing Deadline: April 15, 2026. If you need more time, file Form 4868 for an automatic extension to October 15. The extension gives you more time to file, but NOT more time to pay. Estimate and pay any tax owed by April 15 to avoid penalties.

9. FAQ: 15 Critical Questions About the 1099-DA

Q1: What is Form 1099-DA?

Form 1099-DA is a new IRS informational tax form that reports digital asset disposals (sales, trades, conversions) from U.S. crypto brokers. It's the crypto equivalent of the 1099-B for stocks. For 2025 transactions, it reports gross proceeds only — not cost basis. IRS Source →

Q2: When will I receive my 1099-DA?

The IRS deadline for brokers to deliver 1099-DA forms to taxpayers is February 17, 2026. Check your exchange account under Settings → Tax Documents. Some exchanges deliver electronically; others may mail a physical copy.

Q3: Does the 1099-DA include cost basis?

Not for 2025 transactions. Brokers are only required to report gross proceeds to the IRS this year. Cost basis reporting to the IRS begins for transactions on or after January 1, 2026, and only for "covered" digital assets. Your taxpayer copy may show partial or $0 basis.

Q4: What happens if I file using only the 1099-DA numbers?

The IRS will treat your sale proceeds as 100% gain because no cost basis offsets it. For example, selling 1 BTC at $66,000 would appear as $66,000 in taxable gains with a $15,840 tax bill at 24%. You must report your own cost basis on Form 8949 to avoid this.

Q5: Can I report my own cost basis if the 1099-DA shows $0?

Yes. Under Notice 2025-7, Section 4.02, the IRS explicitly allows taxpayers to use their own lot identification and cost basis records. You are allowed and expected to override $0 or "unknown" basis on the 1099-DA with your actual purchase records.

Q6: Do I need to match my 1099-DA exactly?

Your gross proceeds should match what the exchange reported — the IRS will cross-check this. However, your cost basis should reflect your actual records, not the exchange's incomplete data. Use Form 8949 Column (f) Code B and Column (g) to explain adjustments.

Q7: What about crypto I transferred into an exchange from a wallet?

The exchange cannot track cost basis for transferred-in crypto. The 1099-DA will show $0 basis for these assets. You must use records from the original purchase — whether that's another exchange, a DeFi protocol, mining records, or airdrop FMV — to determine and report the correct basis.

Q8: I used multiple exchanges. Do I get multiple 1099-DAs?

Yes. Each exchange issues its own 1099-DA covering only the transactions that occurred on that platform. If you traded on Coinbase, Kraken, and Gemini, expect three separate forms. Each one goes to both you and the IRS.

Q9: Are DeFi and DEX trades on the 1099-DA?

No. Decentralized exchanges and DeFi protocols are not currently required to issue 1099-DAs (though proposed regulations may change this). You must self-report all DeFi/DEX disposals on Form 8949 using Box I (short-term) or Box L (long-term).

Q10: What about staking rewards?

Staking rewards are taxable as ordinary income at fair market value when received. They are typically reported on 1099-MISC (if over $600), NOT on the 1099-DA. When you later sell staked crypto, the sale goes on Form 8949 with your cost basis being the FMV at the time the reward was received.

Q11: Does the wash sale rule apply to crypto?

As of February 2026, the wash sale rule does not apply to cryptocurrency. You can sell crypto at a loss and repurchase immediately — this is legal tax-loss harvesting. However, Congress has proposed extending the rule to crypto in future legislation. Tax-Loss Harvesting Guide →

Q12: What is per-wallet cost basis?

Starting January 1, 2025, under Revenue Procedure 2024-28, each wallet and exchange is treated as a separate tax account. You can no longer pool cost basis across platforms. FIFO is the default per wallet unless you elect Specific Identification. Per-Wallet Guide →

Q13: Can I use HIFO instead of FIFO?

Yes. Under Notice 2025-7's temporary relief, you can elect Specific Identification (which includes HIFO — Highest In, First Out) for 2025 transactions. This is usually the most tax-efficient method. You must maintain adequate records showing which specific lots you sold.

Q14: What if I don't receive a 1099-DA?

You are still required to report all crypto transactions regardless of whether you receive a 1099-DA. The IRS may still have received a copy from the exchange. Not receiving the form is not a valid excuse for non-reporting. If you traded on a U.S. exchange, contact them to request your form.

Q15: Should I file now or wait?

Wait until you have ALL 1099-DAs (deadline Feb 17) and have reconciled cost basis using tax software. Filing too early with incomplete data can result in overpaying tax. If you need more time, file Form 4868 by April 15 for an automatic extension to October 15. Pay estimated tax by April 15 to avoid penalties.

📚 Related Guides

Per-Wallet Cost Basis 2026 The new IRS rule that changes everything — complete migration guide Tax-Loss Harvesting Mega Guide BTC down 48% from ATH — turn this crash into tax savings Coinbase Q4 $667M Loss What this means for your 1099-DA and crypto taxes CARF 2027 Enforcement Playbook 48 countries sharing your crypto data starting 2027 SEC + CFTC Project Crypto 2026 How single rulebook changes your staking and DeFi taxes DeFi Users: Form 8949 Mismatch Why IRS audit flags are automatic in 2026

Disclaimer: This article is for informational and educational purposes only. It does not constitute tax, legal, or financial advice. Tax laws are complex, change frequently, and vary by jurisdiction. Consult a qualified tax professional (CPA, tax attorney, or enrolled agent) before making any tax-related decisions. The author and Legal Money Talk are not responsible for any actions taken based on this content. All information is based on publicly available IRS guidance, including Notice 2025-7, Revenue Procedure 2024-28, and the Form 1099-DA instructions as of February 2026. Filing requirements and deadlines are subject to change.