DC

Davit Cho

Global Asset Strategist & Crypto Law Expert

📊 Verified Against: SEC EDGAR Filings, IRS Tax Code Updates, Bloomberg ETF Data
📅 Published: January 30, 2026
✉️ Contact: davitchh@proton.me

⚡ 13+ years experience in Global Asset Strategy & Crypto Taxation

 

Form 1099-DA 2026 Filing Deadline — February 17 Is Closer Than You Think

If you traded crypto in 2025, you're about to receive a tax form you've never seen before — and brokers have until February 17, 2026 to send it.

The IRS officially launched Form 1099-DA (Digital Asset Proceeds From Broker Transactions) for the 2025 tax year, marking the first time in history that cryptocurrency exchanges like Coinbase, Kraken, and Gemini are required to report your trades directly to the federal government.

But here's the problem: Most crypto investors have no idea what this form is, how it works, or what penalties await if they file incorrectly.

⚠️ Critical Tax Season Alert

If you sold, swapped, or spent crypto through a U.S. broker in 2025, you will receive Form 1099-DA by mid-February 2026. Ignoring it or filing incorrectly could trigger IRS audits, penalties starting at $60 per form, and criminal tax evasion charges in extreme cases.

This article breaks down everything you need to know about Form 1099-DA before the deadline hits — from who gets it, what information it contains, how to file correctly, and what to do if your form has errors.

📑 Table of Contents

• → What Is Form 1099-DA? (The Basics)
• → Who Gets Form 1099-DA in 2026?
• → Broker Reporting vs Self-Reporting (Key Differences)
• → 5 Costly Filing Mistakes That Trigger IRS Audits
• → Step-by-Step: How to File Form 1099-DA Correctly
• → What If Your Form 1099-DA Is Wrong?
• → Penalty Relief Options for 2026
• → FAQ: Form 1099-DA Questions Answered

What Is Form 1099-DA? (The Basics)

Form 1099-DA is the IRS's new standardized tax form for reporting gross proceeds (and eventually cost basis) from cryptocurrency transactions conducted through U.S.-based brokers.

Think of it as the crypto equivalent of Form 1099-B (which stock brokers like Fidelity or Charles Schwab send you for stock trades). The key difference? This is the first year crypto brokers are legally required to report your trades to the IRS.

🗓️ Key Timeline for 2026 Filing Season

Date	Event	Action Required
Jan 1, 2026	Form 1099-DA reporting goes live	Brokers begin compiling 2025 transaction data
Feb 17, 2026	Deadline for brokers to send Form 1099-DA to taxpayers	You should receive your form by this date
Mar 31, 2026	Deadline for brokers to e-file with IRS	IRS receives all 1099-DA forms electronically
Apr 15, 2026	Tax filing deadline	You must file Form 8949 & Schedule D with Form 1099-DA data

💡 Pro Tip: 2025 vs 2026 Reporting Differences

For 2025 tax year (filed in 2026): Form 1099-DA reports gross proceeds only (total amount received from sales).

Starting 2026 tax year (filed in 2027): Brokers will also report cost basis (what you originally paid), making it easier to calculate capital gains.

📊 What Information Does Form 1099-DA Include?

According to the IRS official guidance (published December 17, 2025), Form 1099-DA contains:

• Gross proceeds from digital asset sales (total amount received)
• Type of transaction (crypto-to-USD, crypto-to-crypto, crypto-to-goods)
• Date of transaction (based on broker's time zone — Coinbase uses Eastern Time)
• Asset type (Bitcoin, Ethereum, stablecoins, NFTs, etc.)
• Covered vs Non-Covered status (determines if broker reports cost basis)

Important: Form 1099-DA does NOT calculate your capital gains for you. You still need to manually calculate cost basis (what you paid originally) and report gains/losses on Form 8949 and Schedule D.

Who Gets Form 1099-DA in 2026?

You'll receive Form 1099-DA if you completed any of these transactions through a U.S.-based crypto broker in 2025:

✅ Transactions That Trigger Form 1099-DA

• Sold crypto for USD or fiat currency (e.g., Bitcoin → USD)
• Swapped one crypto for another (e.g., Ethereum → Solana)
• Used crypto to buy goods/services (e.g., paid for coffee with Bitcoin)
• Paid broker transaction fees with crypto (e.g., paid Coinbase fee in USDC)
• Transferred ownership (e.g., sent crypto as a gift, but reported as disposition)

🌍 U.S. Brokers vs Foreign Exchanges

Exchange Type	Must Send 1099-DA?	Examples
U.S.-Based Brokers	YES ✓	Coinbase, Kraken, Gemini, Robinhood, Cash App
Foreign Exchanges	NO ✗	Binance.com, Bybit, OKX, KuCoin (but you still must self-report!)
DeFi Platforms	NO ✗	Uniswap, Aave, PancakeSwap (no broker = self-reporting required)
Self-Custody Wallets	NO ✗	MetaMask, Ledger, Trezor (you are your own record-keeper)

⚠️ Critical: Foreign Exchange Users Are NOT Exempt

If you traded on Binance.com, Bybit, or any non-U.S. exchange, you will not receive Form 1099-DA. However, you are still legally required to report all transactions on Form 8949. The IRS can trace blockchain transactions, and failure to self-report can lead to criminal tax evasion charges.

Broker Reporting vs Self-Reporting (Key Differences)

One of the biggest sources of confusion in 2026 tax season: What's the difference between broker-reported transactions (Form 1099-DA) and self-reported transactions?

Factor	Broker-Reported (Form 1099-DA)	Self-Reported (DeFi, Foreign Exchanges)
Who Reports?	Broker sends form to you + IRS	You manually report all transactions
IRS Visibility	IRS already knows (automatic matching)	IRS only knows if you report it (but can trace blockchain)
Audit Risk	HIGH if you underreport or ignore	MEDIUM if you self-report honestly
Cost Basis	Not included in 2025 (starts 2026)	You must calculate yourself
Penalty for Mismatch	Automatic CP2000 notice (underreporting penalty)	Failure to file penalty (up to 20% + interest)

💡 Pro Tip: The IRS Uses Automated Matching

When you file your tax return, the IRS computer system automatically cross-checks your reported income against all 1099 forms received. If your Form 8949 shows lower proceeds than what Coinbase reported on Form 1099-DA, you'll receive a CP2000 notice (proposed tax adjustment) within 12-18 months.

5 Costly Filing Mistakes That Trigger IRS Audits

Based on IRS enforcement data and tax attorney case studies, here are the 5 most common mistakes that trigger audits in crypto tax filing:

❌ Mistake #1: Ignoring Form 1099-DA Entirely

The Error: You receive Form 1099-DA showing $50,000 in gross proceeds, but you don't include it in your tax return because "it's just crypto."

The Penalty: The IRS computer system flags your return for underreporting income. You receive a CP2000 notice proposing additional tax + 20% accuracy penalty + interest backdated to April 15, 2026.

How to Avoid: Always report every transaction shown on Form 1099-DA on Form 8949, even if you had losses.

❌ Mistake #2: Reporting Gross Proceeds as Taxable Income

The Error: Your Form 1099-DA shows $100,000 in gross proceeds, and you mistakenly report this as $100,000 of taxable income (instead of calculating capital gains).

The Penalty: You massively overpay taxes. Example: If your cost basis was $95,000, your actual capital gain is only $5,000 — not $100,000.

How to Avoid: Understand that Form 1099-DA shows gross proceeds (total amount received), not profit. You must subtract cost basis to calculate gain/loss.

❌ Mistake #3: Using Wrong Cost Basis Method (FIFO, LIFO, HIFO)

The Error: You switch between FIFO (First In, First Out) and HIFO (Highest In, First Out) methods inconsistently across tax years.

The Penalty: The IRS considers this tax avoidance manipulation and may disallow your chosen method, forcing you to recalculate everything using FIFO (which could increase your tax bill).

How to Avoid: Pick one method and stick with it consistently. Coinbase allows you to select your historical accounting method, but once confirmed, it cannot be changed.

⚠️ IRS FIFO Relief Extended Through December 31, 2025

The IRS delayed mandatory FIFO cost-basis reporting until 2026, meaning for 2025 tax year, you can still choose LIFO, HIFO, or Specific Identification. But starting January 1, 2026, brokers must default to FIFO unless you specify otherwise in advance.

❌ Mistake #4: Not Reporting Foreign Exchange Transactions

The Error: You traded on Binance.com (foreign exchange) and assume "no 1099-DA = no reporting required."

The Penalty: Willful failure to file can lead to criminal tax evasion charges (up to 5 years in prison under 26 U.S.C. § 7201). The IRS is using blockchain analytics tools (Chainalysis, TRM Labs) to trace unreported transactions.

How to Avoid: Use crypto tax software like CoinTracker, Koinly, or TaxBit to import transactions from all exchanges (foreign and domestic) and generate Form 8949 automatically.

❌ Mistake #5: Filing Before Receiving All Forms

The Error: You file your tax return on February 1, 2026 (before Coinbase sends Form 1099-DA by mid-February).

The Penalty: You'll need to file an amended return (Form 1040-X) after receiving the form, which delays your refund and increases audit risk.

How to Avoid: Wait until after February 17, 2026 to ensure you've received all 1099-DA forms from all brokers.

Step-by-Step: How to File Form 1099-DA Correctly

Here's the exact process for filing crypto taxes with Form 1099-DA in 2026:

✅ Step 1: Gather All Form 1099-DA Forms (Deadline: Feb 17, 2026)

• Download from Coinbase: Account → Documents → Tax Forms
• Download from Kraken: Settings → Tax Center → Download 1099-DA
• Check your email for "Tax Document Ready" notifications
• Make a checklist: List all exchanges you used in 2025 and confirm receipt

✅ Step 2: Export Transaction History from All Platforms

• U.S. Brokers: Download CSV transaction history (in addition to Form 1099-DA)
• Foreign Exchanges: Export full trade history (Binance: Wallet → Transaction History → Generate)
• DeFi Wallets: Use blockchain explorers (Etherscan, Solscan) to download transaction CSVs

✅ Step 3: Calculate Cost Basis (You Must Do This Manually for 2025)

Since Form 1099-DA does not include cost basis for 2025, you must calculate it yourself using one of these methods:

Method	Best For	Example
FIFO (First In, First Out)	Long-term holders	You bought BTC at $20K in 2020, $30K in 2023, sold at $90K in 2025 → use $20K basis
LIFO (Last In, First Out)	Active traders	Same scenario → use $30K basis (reduces gain)
HIFO (Highest In, First Out)	Tax optimization	Same scenario → use highest purchase price to minimize gain
Specific Identification	Sophisticated investors	You manually specify which lot you're selling (requires detailed records)

✅ Step 4: Complete Form 8949 (Capital Gains and Losses)

Form 8949 is where you report every single crypto transaction with:

• Column (a): Description of property (e.g., "0.5 BTC")
• Column (b): Date acquired
• Column (c): Date sold
• Column (d): Proceeds (from Form 1099-DA)
• Column (e): Cost basis (what you paid originally)
• Column (h): Gain or loss (Column d minus Column e)

Pro Tip: If you have hundreds of transactions, you can summarize them in one line on Form 8949 and attach a detailed statement (check "Exception Code A" or "Exception Code B").

✅ Step 5: Transfer Totals to Schedule D

Once Form 8949 is complete, transfer the totals to Schedule D (Capital Gains and Losses):

• Short-term gains/losses (held ≤1 year) → Line 1 of Schedule D
• Long-term gains/losses (held >1 year) → Line 8 of Schedule D
• Calculate net capital gain/loss (this flows to Form 1040)

✅ Step 6: Report on Form 1040 and Submit by April 15, 2026

Final step: Include Schedule D totals on Form 1040 Line 7 (capital gain or loss). Then submit your return via:

• IRS Free File (if AGI <$79,000)
• Tax software (TurboTax, H&R Block, FreeTaxUSA)
• Crypto-specific software (CoinTracker, Koinly, TaxBit) for automated Form 8949 generation
• Tax professional (CPA or Enrolled Agent specializing in crypto)

💡 Pro Tip: Use Crypto Tax Software to Avoid Errors

Manual calculation of crypto taxes is extremely error-prone if you have 50+ transactions. Tools like CoinTracker, Koinly, or TaxBit can:

✓ Import transactions from 300+ exchanges and wallets
✓ Automatically calculate cost basis using your chosen method
✓ Generate IRS-ready Form 8949 (some even include 1099-DA reconciliation)
✓ Flag potential errors before you file

Cost: $50-$200 depending on transaction volume (deductible as tax preparation expense).

What If Your Form 1099-DA Is Wrong?

According to IRS guidance (updated December 17, 2025), errors on Form 1099-DA are extremely common in the first year of reporting. Here's what to do:

🔧 Step 1: Contact the Issuer Immediately

Look at the top left corner of Form 1099-DA under "Filer" to find the broker's contact information. Common issues:

• Wrong name or SSN (e.g., Coinbase used your old name before marriage)
• Incorrect state residency (only correctable issue per Coinbase policy)
• Missing transactions (e.g., broker didn't capture off-platform transfers)
• Duplicate reporting (same transaction reported twice)

🔧 Step 2: Request a Corrected Form 1099-DA

If the error is significant (affects taxable amount by >$500), request a corrected Form 1099-DA. The broker must issue:

• A new form marked "CORRECTED" at the top
• Updated information sent to both you and the IRS
• Correction timeline: 2-4 weeks (but don't wait to file your taxes)

🔧 Step 3: File Your Tax Return with Correct Information (Don't Wait!)

Critical IRS Guidance: "Don't wait to file your taxes" — even if the corrected form hasn't arrived yet.

⚠️ How to Handle Incorrect Form 1099-DA While Filing

Option 1: File with the correct information based on your own records. Attach a statement to Form 8949 explaining the discrepancy (e.g., "Broker reported $50,000 in proceeds, but correct amount is $45,000 per attached transaction log").

Option 2: If the error is minor (<$100), report the form "as is" to avoid IRS matching issues, but note the discrepancy in your personal records for audit defense.

Option 3: File for an automatic 6-month extension (Form 4868) to buy time for the corrected form (but you still must pay estimated taxes by April 15).

🔧 Step 4: Keep All Documentation for 7 Years

Save the following in a secure folder (digital or physical):

• Original Form 1099-DA (even if incorrect)
• Corrected Form 1099-DA (when received)
• All email correspondence with the broker
• Transaction history CSVs from all platforms
• Screenshots of wallet transactions (especially DeFi)

Why 7 years? The IRS has 3 years to audit most returns, but for substantial underreporting (>25% of gross income), they have 6 years. Keep records for 7 years to be safe.

Penalty Relief Options for 2026

Since this is the first year of Form 1099-DA reporting, the IRS has indicated (in private letter rulings to brokers) that they will provide limited penalty relief for good-faith errors. Here's what you need to know:

🛡️ First-Year Penalty Relief (2026 Tax Season Only)

Situation	Standard Penalty	Relief Available?
Broker sent late/incorrect Form 1099-DA	$60-$300 per form (broker penalty)	YES — IRS waiving broker penalties for 2025 reporting
You filed late due to waiting for 1099-DA	5% of unpaid tax per month (max 25%)	NO — Must file Form 4868 for extension
You underreported due to reasonable cause	20% accuracy penalty	MAYBE — Must prove "first-year confusion" as reasonable cause
You willfully ignored 1099-DA	Up to 75% fraud penalty + criminal charges	NO — No relief for intentional evasion

🛡️ How to Qualify for Reasonable Cause Exception

If the IRS proposes penalties via CP2000 notice or audit, you can request penalty abatement by proving:

1. First-time penalty abatement: You have a clean tax record for the past 3 years (no prior penalties)
2. Reasonable cause: You can prove you made a good-faith effort to comply (e.g., "Broker sent incorrect form; I filed based on my own records")
3. Reliance on professional advice: A CPA or tax attorney told you to report it a certain way

How to request: File Form 843 (Claim for Refund and Request for Abatement) with supporting documentation.

💡 Pro Tip: File Form 843 Within 2 Years

You generally have 2 years from the date you paid the penalty to request abatement via Form 843. If you receive a CP2000 notice, respond immediately (within 30 days) to dispute the penalty before paying it.

FAQ: Form 1099-DA Questions Answered

❓ Q1: What if I never received Form 1099-DA but I traded on Coinbase in 2025?

Answer: Contact Coinbase support immediately. Check your account's "Tax Documents" section (sometimes forms are only available digitally, not mailed). If Coinbase confirms they didn't send one (e.g., your trades were below reporting threshold), you still must self-report all transactions on Form 8949.

❓ Q2: Do staking rewards appear on Form 1099-DA?

Answer: No. Form 1099-DA only reports dispositions (sales, swaps, exchanges). Staking rewards are reported on Form 1099-MISC (Box 3: Other Income) if they exceed $600. However, selling staking rewards triggers Form 1099-DA.

❓ Q3: Can I use Form 1099-DA to claim crypto losses?

Answer: Yes! If your cost basis exceeds gross proceeds, you have a capital loss (up to $3,000 deductible per year against ordinary income, with unlimited carryforward). Make sure to calculate cost basis accurately and report on Form 8949.

❓ Q4: Does the wash sale rule apply to crypto in 2026?

Answer: No. As of January 30, 2026, the wash sale rule (IRS Section 1091) applies only to stocks, bonds, mutual funds, and ETFs — not cryptocurrency. This means you can sell Bitcoin at a loss and immediately rebuy it to harvest tax losses (this loophole may close in future legislation).

❓ Q5: What if I used multiple cost basis methods across different exchanges?

Answer: Technically, you should use the same method for the same asset (e.g., all Bitcoin transactions use FIFO). However, you can use different methods for different assets (e.g., FIFO for Bitcoin, LIFO for Ethereum). Just be consistent year-over-year to avoid IRS scrutiny.

⚖️ Legal Disclaimer

This article is provided for educational and informational purposes only and does not constitute legal, tax, or financial advice. Tax laws are complex and change frequently. Davit Cho and LegalMoneyTalk do not provide personalized tax advice. Always consult a qualified CPA, Enrolled Agent, or tax attorney before making tax-related decisions. Information is verified against IRS official guidance as of January 30, 2026, but the IRS may issue updates after publication.

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⚠️ Deadline Alert: February 17, 2026

Brokers must send Form 1099-DA by February 17. If you haven't received yours, contact your exchange immediately. Missing this form could cost you thousands in penalties.

📖 Read Full 1099-DA Guide

Questions? Email Davit Cho at davitchh@proton.me
Published: January 30, 2026 | Last Updated: January 30, 2026

✍️ Author: Davit Cho, Global Asset Strategist & Crypto Law Expert

📋 Verification: IRS Notice 2024-56, Notice 2024-57, Final Regulations TD 9961

📅 Published: January 11, 2026

📧 Contact: davitchh@proton.me

Form 1099-DA Penalty Relief 2026 — What the IRS Won't Tell You

The IRS buried penalty relief provisions deep in Notice 2024-56. Most taxpayers will never find them. Here's how to use them before April 15.

Figure 1: The IRS's new Form 1099-DA launches in 2026 with built-in penalty relief provisions that most crypto investors don't know exist—creating a narrow window for compliance without punishment.

💡 Key Takeaways (30-Sec Summary)

• Penalty Relief Window: IRS waives penalties for 2025 transactions if brokers show "good faith" compliance efforts.
• FIFO Delay: Mandatory FIFO cost basis method postponed until 2026—you can still choose your accounting method for 2025.
• Backup Withholding Deferred: 24% backup withholding on crypto sales extended through 2026 under Notice 2025-07.

January 2026 marks a seismic shift in crypto taxation. For the first time, every major exchange must report your transactions directly to the IRS on Form 1099-DA. No more flying under the radar. No more "forgot to report" excuses. The era of crypto tax opacity is officially over.

 

But buried in the 300+ pages of IRS guidance lies something most taxpayers will never discover: comprehensive penalty relief provisions. The IRS knows this transition is messy. They know brokers aren't ready. They know cost basis tracking is a nightmare. So they built escape hatches—temporary relief that protects compliant taxpayers from punishment during this chaotic first year.

 

The problem? The IRS isn't advertising these provisions. They're buried in Notice 2024-56, Notice 2024-57, and scattered across multiple technical guidance documents. If you don't know where to look, you'll never find them. This article extracts every penalty relief provision, explains exactly how to qualify, and gives you the compliance roadmap to navigate 2026 tax season without fear.

 

In my view, this is the most important crypto tax article you'll read this year. Not because the rules are complex—they are—but because the relief provisions expire. Miss the window, and you're subject to full penalties. Use them correctly, and you buy yourself time to get compliant without financial punishment.

🛡️ 100% Ad-Free Experience

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📋 Strategic Blueprint

• 📄 1. What Is Form 1099-DA? The Basics Explained
• 🛡️ 2. Notice 2024-56: The Hidden Penalty Relief Provisions
• 📊 3. FIFO Delay: Why Your Cost Basis Method Still Matters
• 💰 4. Backup Withholding Deferral Through 2026
• 🏢 5. Broker Reporting Requirements: What Exchanges Must Send
• ⚠️ 6. Common Mistakes That Void Your Penalty Relief
• ❓ 7. FAQ — 10 Critical Questions Answered

📄 1. What Is Form 1099-DA? The Basics Explained

Form 1099-DA is the IRS's new standardized reporting form for digital asset transactions. Starting with tax year 2025 (filed in 2026), every crypto broker, exchange, and custodian must report your sales, exchanges, and dispositions directly to the IRS. This is the crypto equivalent of the 1099-B form that stock brokers have used for decades.

 

The form captures critical transaction data: the date of sale, gross proceeds, cost basis (starting 2026), and whether the gain or loss is short-term or long-term. For 2025 transactions reported in early 2026, brokers are only required to report gross proceeds. Full cost basis reporting kicks in for transactions occurring on or after January 1, 2026.

 

This represents a fundamental shift in IRS enforcement capability. Previously, the agency relied on voluntary compliance and occasional subpoenas to exchanges. Now, they receive automatic transaction data matching capabilities. If your tax return doesn't match your 1099-DA, expect a CP2000 notice—or worse, an audit flag.

 

The Infrastructure Investment and Jobs Act (IIJA) of 2021 mandated this reporting requirement, giving the IRS four years to develop the form and regulations. The final rules, published in Treasury Decision 9961, establish the framework that every crypto investor must now navigate.

Tax Year	Reporting Requirement	What Brokers Report
2025 (Filed 2026)	Gross Proceeds Only	Sale date, proceeds amount
2026 (Filed 2027)	Gross Proceeds + Cost Basis	Full transaction details, gain/loss calculation
2027+ (Filed 2028+)	Complete Reporting	All data including wallet transfers

📘 Master the 1099-DA Basics — Complete First Year Guide →

🛡️ 2. Notice 2024-56: The Hidden Penalty Relief Provisions

Notice 2024-56 is where the IRS buried the gold. This technical guidance document, released alongside the final regulations, contains comprehensive penalty relief provisions that most taxpayers and even many tax professionals don't know exist. Understanding these provisions could save you thousands in penalties during this transition year.

 

The core relief provision states that for transactions occurring in calendar year 2025 (reported in 2026), the IRS will not impose penalties for failure to file or furnish Forms 1099-DA if the broker can demonstrate "good faith efforts" to comply with the new requirements. This means brokers get a pass on technical errors, late filings, and incomplete data—as long as they tried.

 

But here's what matters for taxpayers: this broker-level relief flows downstream. If your exchange sends you an incorrect or incomplete 1099-DA, you can rely on that form in good faith without penalty exposure. The IRS explicitly states that taxpayers who receive forms with errors are not penalized for reporting based on the information provided—provided they didn't know the information was incorrect.

 

The relief also extends to backup withholding failures. Normally, brokers must withhold 24% on payments to customers who fail to provide valid TINs. Notice 2024-57 defers this requirement through 2026, giving both brokers and taxpayers additional runway to sort out compliance issues without immediate financial penalties.

📌 Market Reality Check

The practical reality is that most exchanges are scrambling. Coinbase, Kraken, and Gemini have publicly acknowledged challenges in implementing the new reporting requirements. Cost basis tracking for assets transferred between wallets remains technically difficult. The IRS knows this—which is why they built in these relief provisions. Smart taxpayers use this window to get compliant, document their good faith efforts, and avoid the penalty hammer that will fall harder in 2027.

Relief Provision	What It Covers	Expiration
Broker Filing Penalty Waiver	Late/incorrect 1099-DA filings	Tax Year 2025 only
Good Faith Reliance	Taxpayer reliance on broker forms	Tax Year 2025 only
Backup Withholding Deferral	24% withholding requirement	Through December 31, 2026
FIFO Method Delay	Mandatory cost basis method	Until January 1, 2026

👨‍👩‍👧 Inherited Crypto? Special 1099-DA Rules Apply →

📊 3. FIFO Delay: Why Your Cost Basis Method Still Matters

Figure 2: The IRS's phased implementation timeline for 1099-DA reporting requirements, showing the critical transition from gross proceeds-only reporting (2025) to full cost basis disclosure (2026+).

One of the most significant relief provisions concerns cost basis accounting methods. Under the final regulations, brokers would be required to use the First-In-First-Out (FIFO) method for calculating cost basis starting in 2025. FIFO assumes you sell your oldest coins first—which often results in higher taxable gains for long-term holders who bought at lower prices.

 

The IRS delayed mandatory FIFO implementation until January 1, 2026, giving taxpayers one additional year to use their preferred accounting method. This is massive for tax optimization. If you've been using Specific Identification (selecting which lots to sell) or HIFO (Highest-In-First-Out) to minimize gains, you can continue through the end of 2025.

 

For the 2025 tax year, this means you still have flexibility. If you sold Bitcoin at $95,000 and have lots purchased at $60,000 (2024) and $20,000 (2021), you can specifically identify the $60,000 lot to minimize your gain. Under mandatory FIFO, you'd be forced to use the $20,000 lot first—creating a much larger taxable event.

 

Starting January 1, 2026, this flexibility disappears for broker-reported transactions. Brokers must default to FIFO unless you provide specific identification instructions before the sale. The practical implication: if tax optimization matters to you, get your cost basis records organized now, and provide specific lot instructions to your exchange before executing trades in 2026.

Method	How It Works	Tax Impact	2025 Status
FIFO	Sell oldest coins first	Often higher gains	Optional (mandatory 2026+)
LIFO	Sell newest coins first	Often lower gains	Available for 2025
HIFO	Sell highest cost first	Minimizes current gains	Available for 2025
Specific ID	Choose specific lots	Maximum control	Available (requires documentation)

📈 Cost Basis Wrong? IRS Takes 40% More — FMV Documentation →

💰 4. Backup Withholding Deferral Through 2026

Backup withholding is one of the most punishing IRS enforcement mechanisms—and crypto investors nearly faced it in 2025. Under normal rules, if you fail to provide a valid Taxpayer Identification Number (TIN) to your broker, they must withhold 24% of your gross proceeds and remit it directly to the IRS. For a $100,000 Bitcoin sale, that's $24,000 withheld immediately.

 

Notice 2025-07 extended the deferral of backup withholding obligations for digital asset sales through calendar year 2026. This means exchanges don't have to withhold that 24%—even if your TIN is missing or mismatched—giving both brokers and customers time to resolve identification issues without immediate cash flow consequences.

 

This relief is particularly important for international users of U.S. exchanges, customers who opened accounts years ago with incomplete information, and anyone who has changed their legal name or TIN since account creation. Without this deferral, millions of crypto users would face unexpected withholding on every sale.

 

The catch: this is a deferral, not an elimination. Starting January 1, 2027, backup withholding applies in full force. If your exchange is flagging TIN issues now, resolve them before the end of 2026. Once withholding kicks in, getting that money back requires filing a tax return and waiting months for a refund—cash flow you may need.

Timeline	Backup Withholding Status	Action Required
2025	Deferred	None immediate
2026	Deferred (Final Year)	Verify TIN with all exchanges
2027+	Fully Enforced (24%)	Withholding on non-compliant accounts

🌾 DeFi Transactions? Different Rules Apply →

🏢 5. Broker Reporting Requirements: What Exchanges Must Send

Figure 3: Comparison of broker reporting obligations under the new 1099-DA regime—showing the phased implementation from gross proceeds only (2025) to full cost basis and gain/loss reporting (2026+).

Not all crypto platforms are created equal under the new rules. The IRS definition of "broker" determines who must file 1099-DA forms. Centralized exchanges like Coinbase, Kraken, Gemini, and Binance.US clearly qualify. They custody your assets, process your trades, and know your identity—making them natural reporting entities.

 

Decentralized exchanges (DEXs) and DeFi protocols occupy a grayer zone. The final regulations include provisions for "DeFi brokers"—front-end interfaces that facilitate trades—but enforcement mechanisms remain unclear. For 2025-2026, most DEX activity will likely escape 1099-DA reporting, though taxpayers remain responsible for self-reporting regardless of whether they receive forms.

 

What brokers must report for 2025 transactions (your first 1099-DA arriving in early 2026): gross proceeds from each sale or exchange. This includes crypto-to-crypto trades—swapping ETH for BTC is a taxable event reported on the form. Brokers are not required to report cost basis for 2025, though many will include it voluntarily if available.

 

Starting with 2026 transactions (reported in 2027), brokers must include cost basis for "covered securities"—assets acquired on or after January 1, 2023, on that same platform. Assets transferred in from external wallets or purchased before 2023 may show "N/A" for basis, leaving taxpayers responsible for tracking and reporting their own cost basis.

Platform Type	1099-DA Required?	Notes
Centralized Exchanges (CEX)	Yes	Coinbase, Kraken, Gemini, etc.
Custodial Wallets	Yes	If they facilitate sales
DEX Front-Ends	TBD (2027+)	Regulations pending enforcement
Self-Custody Wallets	No	No broker relationship
P2P Transactions	No	Self-reporting required

🪙 Staking Rewards on 1099-DA? Know the Rules →

⚠️ 6. Common Mistakes That Void Your Penalty Relief

Penalty relief isn't automatic. The IRS grants it based on "good faith" compliance—which means you can lose protection through carelessness, negligence, or willful disregard. Understanding what voids your relief is just as important as knowing it exists.

 

Mistake #1: Ignoring the Digital Asset Question. Form 1040 now includes a mandatory checkbox asking whether you received, sold, exchanged, or disposed of digital assets. Checking "No" when the answer is "Yes" is considered a false statement under penalty of perjury. Even if you qualify for penalty relief on reporting errors, lying on your return voids all protections.

 

Mistake #2: Failing to Report Known Income. If you received staking rewards, airdrops, or mining income that you know is taxable, not reporting it isn't covered by the 1099-DA penalty relief provisions. Relief applies to form filing issues—not to taxpayers who simply don't report income they know they owe.

 

Mistake #3: Intentionally Providing False Basis. When your exchange can't calculate cost basis (common for transferred-in assets), you must provide it yourself. Fabricating a higher basis to reduce gains is tax fraud—not a good faith error covered by relief provisions. Keep documentation: purchase records, blockchain timestamps, exchange statements.

Mistake #4: Missing Form 8949 Entirely. The 1099-DA flows to Form 8949 (Sales and Other Dispositions of Capital Assets). Even if your broker's form has errors, you must still file Form 8949 with your return. Penalty relief doesn't excuse you from filing—it protects you from penalties when you file with good faith reliance on broker data.

🚩 IRS Audit Red Flags — Avoid Getting Flagged →

❓ 7. FAQ — 10 Critical Questions Answered

Q1: When will I receive my first Form 1099-DA?

Brokers must furnish 1099-DA forms by February 15, 2026, for tax year 2025 transactions. However, under transitional relief, forms may arrive later—some taxpayers might receive them after the April 15 filing deadline, requiring amended returns.

Q2: What if my 1099-DA has errors?

Report based on what you believe is correct, attach an explanation statement, and keep documentation of your actual basis. You qualify for good faith reliance protection if you used the broker's data reasonably and corrected obvious errors.

Q3: Does penalty relief apply to taxpayers or just brokers?

Both. Brokers get relief from filing penalties; taxpayers get relief from accuracy penalties when they rely in good faith on broker-provided information. The provisions work in tandem.

Q4: Is DeFi activity reported on 1099-DA?

Not yet for most protocols. The IRS has proposed regulations for DeFi brokers, but enforcement is delayed. You must still self-report DeFi income regardless of whether you receive a form.

Q5: Can I still use HIFO or Specific ID for 2025 transactions?

Yes. Mandatory FIFO doesn't begin until January 1, 2026. For 2025 transactions, you can use any consistent, reasonable method with proper documentation.

Q6: What is backup withholding and does it apply to me?

Backup withholding requires brokers to withhold 24% from sales if you haven't provided a valid TIN. It's deferred through 2026 for crypto—but verify your exchange accounts have correct tax IDs before 2027.

Q7: Do I need to report crypto-to-crypto trades?

Yes. Swapping BTC for ETH is a taxable event. Your 1099-DA will report the gross proceeds from each trade. You must calculate and report the gain or loss on Form 8949.

Q8: What if I transferred crypto between wallets?

Transfers between your own wallets are not taxable events. However, brokers may report them as potential dispositions. Keep records showing the transfer was to yourself—same cost basis carries over.

Q9: How long does penalty relief last?

Filing penalty relief applies to tax year 2025 only. Backup withholding deferral extends through 2026. Starting 2027, full enforcement begins with no transitional relief.

Q10: Should I file an extension to wait for late 1099-DAs?

Consider it if you expect multiple late forms. An extension gives you until October 15 to file—but pay estimated taxes by April 15 to avoid interest. File Form 4868 for an automatic 6-month extension.

📅 Full 2026 Crypto Tax Calendar — Key Deadlines →

⚠️ Legal Disclaimer

This article is for informational purposes only and does not constitute legal, tax, or investment advice. Tax laws are complex and change frequently. Consult a qualified tax professional for advice specific to your situation. LegalMoneyTalk is not a law firm or CPA practice.

Image Disclosure: Images are AI-generated for illustrative purposes and do not represent actual IRS forms or official government documents.

🏛️ IRS Official: Notice 2024-56 Penalty Relief Guidance →

Q1 2026 Crypto Tax Calendar — Key Deadlines & Action Items 📅

✍️ Written by Davit Cho

Crypto Tax Specialist | CEO at JejuPanaTek (2012~)

Patent Holder (Patent #10-1998821) | 7+ years crypto investing since 2017

Personally filed crypto taxes since 2018

LinkedIn: linkedin.com/in/davit-cho-crypto

Blog: legalmoneytalk.blogspot.com

Contact: davitchh@gmail.com

📅 Last Updated: December 28, 2025 | ✅ Fact-Checked: Based on IRS Publications & Official Guidelines

📋 Table of Contents

• 📅 January Deadlines & Tasks
• 📋 February Tax Preparation
• 📝 March Filing Strategies
• 📄 1099-DA Forms — First Year
• 💰 Q1 Estimated Tax Payments
• ⚠️ Common Q1 Mistakes to Avoid
• ❓ FAQ

⚡ Quick Facts — Q1 2026

📅 Q4 2025 Estimated Tax Due: January 15, 2026

📄 1099-DA Forms Mailed By: January 31, 2026

📝 Tax Filing Deadline: April 15, 2026

💰 Q1 2026 Estimated Tax Due: April 15, 2026

📋 Extension Deadline: October 15, 2026

Source: IRS Tax Calendar 2026

📖 Official IRS Guidance

📄 IRS Virtual Currency FAQ

📄 Form 8949 Instructions

📄 Schedule D Instructions

📄 IRS Direct Pay — Make Estimated Payments

📄 Form 4868 — Extension Request

Q1 2026 is the most critical quarter for crypto investors when it comes to taxes. The first three months of the year determine whether you file smoothly or scramble at the last minute. With new 1099-DA reporting requirements starting in 2026, this year is especially important to get right. Missing deadlines can cost you hundreds or even thousands in penalties.

 

내가 생각했을 때, most crypto investors underestimate how much preparation Q1 requires. They wait until April and then panic when they realize they need transaction history from five different exchanges and three DeFi protocols. The key is starting early and staying organized throughout the quarter. This calendar breaks down exactly what you need to do each month so you can file with confidence.

 

Whether you traded Bitcoin, staked Ethereum, farmed DeFi yields, or collected NFTs, this guide covers the deadlines and action items you need to know. The IRS is paying closer attention to crypto than ever before, and 2026 marks the first year of mandatory broker reporting. Being prepared is not optional anymore — it is essential for avoiding penalties and audits.

 

📅 January Deadlines & Tasks

January is the foundation month for your entire tax filing process. The most important deadline is January 15, 2026, when your Q4 2025 estimated tax payment is due. If you earned staking rewards, mining income, or had significant trading profits in October through December 2025, you need to make this payment to avoid underpayment penalties.

 

The penalty for underpayment is calculated daily and compounds quickly. For 2026, the IRS underpayment rate is expected to be around 8% annually. That means every $10,000 you underpay costs you approximately $800 per year in penalties, plus interest. Making your January 15 payment on time eliminates this risk for Q4 2025 income.

 

Beyond the payment deadline, January is when you should start gathering all your transaction records. Every exchange you used in 2025 — Coinbase, Kraken, Gemini, Binance.US, and others — will have transaction history available for download. Do not wait until February or March when their systems might be overloaded with tax season traffic.

 

For DeFi users, January is when you need to pull your on-chain transaction data. Tools like Etherscan, BscScan, and other block explorers let you export CSV files of all your wallet activity. If you used protocols like Uniswap, Aave, Compound, or Curve, you need records of every swap, deposit, withdrawal, and reward claim. This data does not come automatically — you have to actively retrieve it.

 

📅 January Action Checklist

Date	Action Item	Priority
Jan 1-5	Download all exchange transaction history	High
Jan 1-10	Export DeFi wallet transactions	High
Jan 15	Q4 2025 estimated tax payment due	Critical
Jan 20-31	Import data into tax software	Medium
Jan 31	1099-DA forms mailed by exchanges	Info

 

By January 31, exchanges are required to mail 1099-DA forms to customers for the first time in 2026. This is a major change from previous years when crypto reporting was largely self-reported. Expect to receive these forms in early to mid-February. However, do not rely solely on 1099-DA — it may not include all your transactions, especially if you used DeFi, self-custody wallets, or foreign exchanges.

 

One mistake I see every year is investors forgetting about staking rewards and mining income when calculating their estimated payment. Remember, staking rewards are taxed as ordinary income the moment you receive them. If you earned 2 ETH in staking rewards during Q4 when ETH was worth $3,500, that is $7,000 of taxable income you need to account for in your January 15 payment.

 

💰 Don't Miss Your January 15 Payment!

Pay your Q4 2025 estimated taxes now to avoid penalties.

💳 Pay Now via IRS Direct Pay

 

📋 February Tax Preparation

February is the month for organizing everything you gathered in January. By now you should have received your 1099-DA forms from exchanges, and your crypto tax software should have most of your transaction data imported. This is when you identify discrepancies, fix errors, and choose your cost basis method.

 

The first step in February is comparing your 1099-DA forms against your own records. Exchanges sometimes make mistakes, and the 2026 tax year is the first time they are issuing these forms. You may find transactions missing, incorrect cost basis reported, or even duplicate entries. Do not assume the 1099-DA is accurate — verify everything against your personal transaction history.

 

If your 1099-DA shows unknown cost basis for any transactions, you need to provide the correct figures yourself. The IRS assumes a cost basis of zero if no basis is reported, which means you would owe taxes on the entire sale proceeds as profit. This can dramatically inflate your tax bill if you do not correct it.

 

Choosing the right cost basis method can save you thousands of dollars. HIFO (Highest In, First Out) typically minimizes your taxable gains by assuming you sold the coins you paid the most for. However, once you choose a method, you should apply it consistently. Switching methods mid-year or between years can raise red flags with the IRS.

 

📋 Cost Basis Methods Comparison

Method	Description	Best For
FIFO	First In, First Out — oldest coins sold first	Rising markets, long-term holders
LIFO	Last In, First Out — newest coins sold first	Falling markets, minimizing gains
HIFO	Highest In, First Out — highest cost coins sold first	Minimizing taxable gains
Specific ID	You choose exactly which coins to sell	Maximum tax optimization

 

February is also when you should calculate your total crypto income for the year. This includes not just trading gains, but also staking rewards, mining income, DeFi yields, airdrops, and any crypto received as payment for goods or services. Each category may have different tax treatment, so separating them now makes filing much easier.

 

If you are using crypto tax software like CoinTracker, Koinly, or TaxBit, February is when you should run your first complete tax report. Review it carefully for any transactions marked as unknown, transfers incorrectly classified as sales, or missing cost basis. These tools are powerful but not perfect — human review is still essential.

 

📊 Need Help Calculating Your Crypto Taxes?

See our comparison of the best crypto tax software for 2026.

🔍 Best Crypto Tax Software 2026

 

📝 March Filing Strategies

March is decision time. You need to decide whether to file your taxes by April 15 or request an extension to October 15. Both options have pros and cons, and the right choice depends on your specific situation. Either way, March is when you finalize all your calculations and prepare your actual tax forms.

 

If your crypto transactions were straightforward — mostly buying and holding with a few sales — filing by April 15 is usually the better option. You get your refund faster (if applicable), avoid the stress of an extended deadline, and close out the tax year completely. Early filers also reduce their risk of identity theft, as scammers cannot file fraudulent returns in your name once you have already filed.

 

However, if you had complex activity — DeFi protocols, multiple wallets, NFT trading, staking across several platforms — an extension might be wiser. The extension gives you until October 15 to file, providing six extra months to sort out complicated transactions. Just remember: an extension to file is not an extension to pay. You still owe any taxes by April 15.

 

📝 Filing vs Extension Decision Guide

Situation	Recommendation	Reason
Simple trades only	File by April 15	Get refund faster, reduce fraud risk
Complex DeFi activity	Request extension	More time to categorize transactions
Missing 1099-DA forms	Request extension	Wait for corrected forms
Expecting refund	File by April 15	Get money sooner
Owe significant taxes	Either — but pay by April 15	Avoid penalties and interest

 

In March, you should finalize your Form 8949, which reports each individual crypto transaction. This form feeds into Schedule D, which summarizes your total capital gains and losses. If you have hundreds or thousands of transactions, crypto tax software generates these forms automatically — but always review them before filing.

 

📄 Need More Time to File?

Get until October 15, 2026 to file — but pay any taxes owed by April 15.

📝 Get Form 4868 Instructions

 

📄 1099-DA Forms — First Year

2026 marks a historic change in crypto taxation: the first year of mandatory 1099-DA reporting. Exchanges like Coinbase, Kraken, Gemini, and Binance.US are required to report your crypto transactions directly to the IRS. This is the biggest shift in crypto tax enforcement since the IRS first clarified that crypto is property in 2014.

 

You should receive your 1099-DA forms by mid-February. These forms report every sale, trade, and disposal that occurred on the exchange during 2025. The IRS receives an identical copy, so they know exactly what your exchange reported. Any discrepancy between your tax return and your 1099-DA will be flagged automatically.

 

The 1099-DA includes several key pieces of information: the date of each transaction, the type of transaction (sale, trade, etc.), the gross proceeds, the cost basis (if known), and the gain or loss. For the first few years, cost basis reporting may be incomplete because exchanges do not always have your full purchase history, especially if you transferred coins in from another platform.

 

📄 What Your 1099-DA Includes

Field	Description	Your Action
Gross Proceeds	Total value received from sales	Verify against your records
Cost Basis	What you paid for the crypto	Correct if shows "unknown"
Gain/Loss	Difference between proceeds and basis	Verify calculation is accurate
Date Acquired	When you bought the crypto	Check for long vs short-term
Date Sold	When you disposed of the crypto	Confirm matches your records

 

The biggest issue with 1099-DA forms in 2026 will be the unknown cost basis problem. If you transferred Bitcoin from a hardware wallet to Coinbase and then sold it, Coinbase does not know what you originally paid. They will report the cost basis as unknown, and the IRS will assume it is zero. This means you could be taxed on the entire sale amount as profit unless you provide the correct basis.

 

📄 First Year of 1099-DA Reporting

Learn what to expect and how to prepare for the new requirements.

📖 Read Our Complete 1099-DA Guide

 

💰 Q1 Estimated Tax Payments

If you expect to owe $1,000 or more in taxes for 2026, you are required to make quarterly estimated tax payments. Q1 covers income earned from January 1 through March 31, and the payment is due on April 15, 2026 — the same day as the tax filing deadline. This timing trips up many investors who focus on filing and forget about the estimated payment.

 

Estimated payments apply to all crypto income that is not subject to withholding. This includes trading profits, staking rewards, mining income, DeFi yields, and any crypto received as payment. Unlike a regular job where your employer withholds taxes from each paycheck, crypto income comes to you gross — and you are responsible for setting aside and paying the taxes yourself.

 

The safe harbor rule protects you from underpayment penalties if you pay either 100% of last year's tax liability or 90% of the current year's liability (whichever is smaller). If your adjusted gross income exceeded $150,000 last year, the threshold increases to 110% of last year's liability. Meeting one of these thresholds means no penalty, even if you ultimately owe more when you file.

 

💰 2026 Estimated Tax Payment Schedule

Payment	Income Period	Due Date
Q4 2025	Oct - Dec 2025	January 15, 2026
Q1 2026	Jan - Mar 2026	April 15, 2026
Q2 2026	Apr - May 2026	June 16, 2026
Q3 2026	Jun - Aug 2026	September 15, 2026
Q4 2026	Sep - Dec 2026	January 15, 2027

 

Calculating your Q1 estimated payment involves projecting your crypto income for the quarter. If you earned $10,000 in staking rewards during Q1, and you are in the 24% tax bracket, you would owe approximately $2,400 in federal income tax plus self-employment tax if applicable. Add state income tax based on your location. A good rule of thumb is to set aside 30-40% of all crypto income for taxes.

 

⚠️ Common Q1 Mistakes to Avoid

Every tax season, I see the same mistakes repeated by crypto investors. Understanding these common errors can save you money, stress, and potential IRS problems. Here are the most frequent Q1 mistakes and how to avoid them.

 

The number one mistake is waiting until April to start. Q1 preparation should begin in January, not in the final weeks before the deadline. Investors who wait find themselves scrambling to download transaction history, fix software errors, and understand complex transactions all under time pressure. This leads to mistakes and missed deductions.

 

Another major mistake is forgetting about crypto-to-crypto trades. Every time you swap Bitcoin for Ethereum, or exchange any crypto for another, you trigger a taxable event. The gain or loss is calculated based on the fair market value at the time of the trade. Many investors think only sales to USD are taxable — this is wrong and can result in massive underreporting.

 

⚠️ Common Q1 Mistakes

Mistake	Consequence	How to Avoid
Waiting until April	Errors, missed deductions	Start in January
Ignoring crypto-to-crypto trades	Underreporting income	Report every swap
Trusting 1099-DA blindly	Incorrect basis, overpaying	Verify against records
Missing staking/mining income	IRS mismatch notice	Track all income sources
Forgetting DeFi activity	Unreported income	Export wallet history
Missing estimated payment	Penalties and interest	Pay by January 15 and April 15

 

Forgetting about staking rewards and mining income is another frequent error. These are taxable as ordinary income when received, not just when sold. If you staked ETH throughout 2025 and earned rewards, each reward is a separate taxable event at the fair market value on the date of receipt. Use your staking platform's transaction history to identify every reward.

 

🚨 Avoid These Costly Errors

Know the IRS audit red flags before you file.

🔍 IRS Crypto Audit Red Flags 2026

 

❓ FAQ

Q1. When is the Q4 2025 estimated tax payment due?

 

A1. January 15, 2026. This covers crypto income earned from October through December 2025. Missing this deadline results in underpayment penalties.

 

Q2. When will I receive my 1099-DA forms?

 

A2. Exchanges must mail 1099-DA forms by January 31, 2026. Expect to receive them in early to mid-February. Check your exchange account for electronic versions as well.

 

Q3. What if my 1099-DA shows incorrect cost basis?

 

A3. Report the correct cost basis on your Form 8949. The IRS allows you to correct 1099 information, but keep documentation proving your actual cost basis in case they ask.

 

Q4. Should I file by April 15 or request an extension?

 

A4. If your crypto activity was simple, file by April 15 to get any refund faster. If you had complex DeFi transactions or missing information, an extension to October 15 gives you more time — but you still must pay any taxes owed by April 15.

 

Q5. Do DeFi transactions appear on 1099-DA forms?

 

A5. No. DeFi protocols and decentralized exchanges do not issue 1099-DA forms. You are responsible for tracking and reporting all DeFi activity yourself.

 

Q6. How much should I set aside for crypto taxes?

 

A6. A safe rule is 30-40% of all crypto income. This covers federal income tax, potential state tax, and self-employment tax if applicable. Adjust based on your specific tax bracket.

 

Q7. What is the penalty for missing estimated tax payments?

 

A7. The underpayment penalty is approximately 8% annually, calculated daily on the amount you underpaid. For a $10,000 underpayment over one year, that is about $800 in penalties plus interest.

 

Q8. Which cost basis method should I use?

 

A8. HIFO (Highest In, First Out) typically minimizes taxable gains. However, choose a method you can apply consistently year after year. Consult a tax professional if you are unsure which method is best for your situation.

 

📚 Related Articles

📄 1099-DA Crypto Tax Form 2026 — First Year Guide

📄 Crypto Staking Taxes 2026 — How Staking Rewards Are Taxed

📄 DeFi Taxes 2026 — Liquidity Pools & Yield Farming

📄 IRS Crypto Audit Red Flags 2026 — How to Avoid Getting Flagged

📄 Best Crypto Tax Software 2026

⚠️ Disclaimer

This article is for informational purposes only and does not constitute tax, legal, or financial advice. Tax laws are complex and subject to change. Consult a qualified tax professional for advice specific to your situation. The author and publisher are not responsible for any actions taken based on this information.

Last Updated: December 28, 2025 | Sources: IRS Publications, IRS Virtual Currency FAQ, Form 8949 Instructions