Form 1099-DA Basis and Noncovered Digital Assets Guide (2025-2026)
How to approach this
A source-based path from understanding the rule to filing and recordkeeping.
Determine the requirement
Confirm whether and how the rule applies to you.
Identify the forms
Map the requirement to the specific IRS forms involved.
Prepare and file
Complete the forms accurately and submit on time.
Retain records
Keep documentation supporting every figure you report.
Key Takeaways
- Most 2025 Form 1099-DA statements may not include basis.
- Digital assets acquired before January 1, 2026 are generally noncovered for 1099-DA purposes.
- Transfer-in assets can also complicate basis reporting.
- Internal basis records remain essential even in the new broker-reporting era.
Early 1099-DA years require extra basis work
The IRS reminder on digital assets from January 28, 2026 says most 2025 Form 1099-DA statements will not include basis and taxpayers will need to calculate basis to determine gain or loss. That is one of the biggest practical traps in the first reporting cycle. A form with proceeds but no basis looks complete until the tax computation begins.
The covered versus noncovered distinction matters a lot
The 2025 Instructions for Form 1099-DA say a digital asset acquired before January 1, 2026 is a noncovered security for these purposes, and assets transferred into a custodial broker can also be noncovered. That means basis reporting may remain limited even after the new regime starts if the broker did not have the acquisition information in the right way.
Wallet history and transfer-in records become audit files
A digital asset business should preserve acquisition date, acquisition cost, transfer-in support, wallet mapping, and transaction fees in a format that can survive beyond any one exchange statement. The IRS form does not eliminate the need for your own basis file. It makes that file more valuable.
Frequently Asked Questions
Will a 2025 Form 1099-DA usually show basis?
Not always. IRS guidance says most 2025 statements will not include basis, so taxpayers often must calculate it themselves.
What is a noncovered digital asset under the 1099-DA instructions?
The instructions say assets acquired before January 1, 2026 and certain transfer-in assets are generally noncovered.
Why should a business keep wallet-level history after 1099-DA starts?
Because the broker statement may still be incomplete for basis and holding-period purposes.
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