Will Your 2026 Form 1099-DA Show Your Crypto Cost Basis?
Starting with 2026 sales, Form 1099-DA reports crypto basis only for covered units. Learn which coins qualify, what's left blank, and how to fix gaps.
Probably not for everything. Starting with sales after 2025, crypto brokers must report your cost basis on Form 1099-DA, but only for covered units: coins acquired after 2025 in a custodial account and held there until the broker sells them (IRS Form 1099-DA instructions). If you bought before 2026 or moved coins between platforms, expect gaps, and fill them yourself.
The forms for 2026 sales arrive early next year. For context, brokers had until February 17, 2026 to send the first round of 1099-DAs, and the IRS warned that most of those would not include basis. The time to fix your records is the next ten weeks, while you still control the year-end trades.
This is general education, not advice for your specific situation.
What is a covered digital asset for Form 1099-DA?
The 2026 instructions define a covered security as a digital asset acquired after 2025 "in an account for which the broker provided custodial services" and "held in that account until the broker effects the disposition" (IRS). Both conditions matter. Buying on the exchange isn't enough if the coins later leave and come back.
The same instructions list what is noncovered, including:
- Digital assets acquired before 2026.
- Digital assets transferred in to the broker.
- Assets the broker didn't hold in custody when they were acquired.
For noncovered units, the broker "is not required to report basis information," though it may do so voluntarily (IRS).
What will your 2026 Form 1099-DA show?
Here is how common situations generally line up. These are hypothetical patterns, not a prediction of how any particular exchange will prepare its forms.
| Your situation | Proceeds (box 1f) | Cost basis (box 1g) | What you need |
|---|---|---|---|
| Bought on the exchange in 2026, sold there in 2026 | Reported | Reported to the IRS | Confirm it matches your records |
| Bought on the exchange in 2023, sold in 2026 | Reported | May be blank (box 9 checked) | Your own purchase records |
| Bought in 2026 elsewhere, transferred in, then sold | Reported | May be blank; boxes 12a and 12b may show the transfer | Records from the original platform |
| Sold from a self-custody wallet or a platform that isn't your custodial broker | Possibly no form | None | Full records for proceeds and basis |
A few box details are worth knowing when the form arrives:
- Box 1f shows gross proceeds, reduced by transaction costs such as fees and commissions.
- Box 1g shows basis. The instructions tell brokers to enter -0- "only if the digital asset sold actually had a basis of zero," so a blank box is not the same as a zero basis.
- Box 9 may be checked for noncovered units, and box 2 indicates basis was reported to the IRS.
- Boxes 12a and 12b report the units transferred in and the transfer-in date.
All of these come from the 2026 Form 1099-DA instructions.
Why do transfers between wallets cause basis gaps?
Transfers are the most common reason a form shows proceeds with no basis. When you move coins from one exchange to another, or from a hardware wallet to an exchange, the receiving broker generally treats them as noncovered. Unless it takes your acquisition information into account, it treats the units as acquired when they arrived (IRS).
That doesn't change your actual tax basis. It changes who has to prove it. Your basis still comes from what you paid, and since 2025 you track it separately for each wallet or account rather than pooling everything (Rev. Proc. 2024-28). If the original platform has closed or your exports are incomplete, rebuilding that history takes time.
How do you report Form 1099-DA sales on Form 8949?
Form 8949 now has separate digital asset boxes. According to the Form 8949 instructions (the 2025 version is the most recent posted):
| Holding period | Basis reported to the IRS | Basis missing or not reported to the IRS | No Form 1099-DA |
|---|---|---|---|
| Short-term (Part I) | Box G | Box H | Box I |
| Long-term (Part II) | Box J | Box K | Box L |
The instructions say not to use boxes C or F for digital asset transactions.
If the basis on a form is wrong, the fix depends on the box. For box G or J, you enter the basis shown on the form and correct it with adjustment code B in column (g). For box H or K, you enter the correct basis in column (e) and -0- in column (g) (IRS). Either way, the number you report needs records behind it.
Do stablecoins and NFTs always show up on a 1099-DA?
Not always. Brokers may use optional reporting methods:
- Qualifying stablecoins: A broker using the optional method doesn't have to report designated sales if your total proceeds from them at that broker are $10,000 or less for the year.
- Specified NFTs: A broker using the optional method doesn't have to report if your total proceeds are $600 or less for the year.
Both thresholds come from the 2026 Form 1099-DA instructions. Staking rewards don't go on Form 1099-DA either, and reporting on certain staking, lending and wrapping transactions is deferred under Notice 2024-57 (IRS). None of that makes those items tax-free. The IRS is direct on this: "Every taxpayer must report any related income, gains, or losses, whether they receive a Form 1099-DA or not" (IRS).
What should you do before December 31?
I'd treat this as a records project, finished before you make year-end sales:
- List every platform and wallet you used in 2026, including ones you've stopped using.
- Export full transaction histories now, while accounts are open and download tools still work.
- Flag every transfer in so you know which sales will likely show blank basis.
- Match pre-2026 lots to purchase records for each account, consistent with the wallet-by-wallet rules.
- Decide on lot identification before you sell. Our post on 2026 crypto lot selection explains the Notice 2026-20 relief that ends December 31.
- Share the records with your tax preparer before the 1099-DAs arrive, so reconciling them is a check, not a scramble.
If you hold crypto through an exchange-traded fund instead, your reporting usually looks different. Our bitcoin ETF overview covers that. For the broader rules on how sales, swaps and income are taxed, see our cryptocurrency tax and financial planning guide.
How can Mercer Street help?
At Mercer Street, we provide advice without taking custody of your assets or charging a percentage of what you hold. A crypto basis review can be a limited-scope project, coordinated with your tax preparer, to organize records, sort covered from noncovered sales, and plan year-end trades.
Clients who work with Mercer Street on a full financial plan get the best rate of $450 per hour. Clients who engage Mercer Street on a limited-scope basis pay $600 per hour with a 2-hour minimum ($1,200). Our services page explains the engagement options.
If you want to get your records in order before the forms arrive, schedule a free fit meeting. Fit meetings are virtual, and we can talk through whether a focused review makes sense for you.
Frequently asked questions
Does Form 1099-DA show cost basis for 2026?
Only for covered units. For sales after 2025, a broker must report basis for digital assets acquired after 2025 in an account where it provided custodial services, as long as the units stayed in that account until sold. Coins bought before 2026 or transferred in from elsewhere are noncovered, and the broker may leave the basis box blank.
Why is the cost basis missing on my Form 1099-DA?
Usually because the units are noncovered. That includes crypto bought before 2026, coins transferred in from another wallet or exchange, and assets the broker didn't hold when they were acquired. The broker reports gross proceeds and can check box 9 to show the units are noncovered. You still report the sale using your own basis records.
Do transferred crypto coins keep their cost basis on a 1099-DA?
Not for broker reporting. Under the 2026 Form 1099-DA instructions, a digital asset transferred in to a custodial broker is a noncovered security, so the broker isn't required to report its basis. Boxes 12a and 12b may show the units transferred in and the transfer date. Your actual tax basis comes from your purchase records, which you need to keep.
Which Form 8949 box do I use for Form 1099-DA transactions?
Short-term digital asset sales use box G, H or I, and long-term sales use box J, K or L. Use G or J when the 1099-DA shows basis reported to the IRS, H or K when basis is missing or wasn't reported to the IRS, and I or L when you received no 1099-DA. Don't use boxes C or F for digital assets.
What if the basis on my Form 1099-DA is wrong?
Report it with adjustment code B on Form 8949. If the transaction belongs in box G or J, enter the basis shown on the form and correct it with an adjustment in column (g). If it belongs in box H or K, enter the correct basis in column (e) and -0- in column (g). Keep the records that support your number.
Do I have to report crypto if I don't get a Form 1099-DA?
Yes. The IRS says every taxpayer must report digital asset income, gains or losses whether or not they receive a Form 1099-DA. Sales through self-custody wallets or platforms that don't act as your custodial broker may not produce a form at all. You would report those on Form 8949 using box I or L.
This article is for general educational purposes and is not individualized tax, legal, or investment advice. Tax laws change; confirm how current rules apply to your situation before acting.
