Form 1099-DA arrived. It skips the number that matters.

Form 1099-DA — "DA" for digital asset — showed up on client documents for the first time this filing season, reporting gross proceeds from every digital-asset sale a broker processed in 2025. What it does not report, under the IRS's own final regulations, is what any of it cost. Basis reporting on the form doesn't start until sales made on or after January 1, 2026 — returns that get reviewed next year, not the ones on a reviewer's desk right now.

A 1099-B lets a reviewer trust the basis box without a second thought. A 1099-DA this year runs the opposite way: the broker confirms what was sold, not what it cost — that part comes only from the client. Take a client who buys Bitcoin on Coinbase, moves it to a hardware wallet for a year, then sells it on Kraken. Kraken's 1099-DA reports the sale price. It has no record of what the client paid on Coinbase a year earlier, and it doesn't pretend to.

What the form does and doesn't carry

The requirement itself isn't new law being tested; it's a final rule, phased in on a published timeline. Custodial brokers, hosted-wallet providers, kiosks and certain payment processors must report gross proceeds for digital-asset sales effected on or after January 1, 2025. The IRS also built in room to get it wrong the first year: Notice 2024-56 waives reporting and backup-withholding penalties on 2025 transactions for a broker that makes a good-faith effort to file correctly and on time. That relief protects the broker. It says nothing about whether the number a reviewer is looking at is right.

• Assets transferred in from another broker or a self-custody wallet — the receiving broker has no record of what they cost
• Anything purchased before 2026, since it isn't a "covered security" under the reporting rules yet
• Crypto ETFs structured as grantor trusts, which the rules also treat as not covered
• NFTs and stablecoins, which can arrive aggregated on the form even when they need to be broken out as separate lines on Form 8949

What changes at the review desk

A 1099-B lets a reviewer check proceeds against the trade confirmation and take the basis box on faith, flagging only when the two disagree. A 1099-DA this season can't be checked that way, because there is no basis box to take on faith. The step that used to be a glance is now a build: pulling the client's own exchange statements and wallet exports, establishing the acquisition date and cost for each disposal by hand, and populating Form 8949 from that record rather than from the broker's filing. The good-faith relief in Notice 2024-56 is a reason to look harder at the proceeds figure too, not less — it exists precisely because this year's reporting is allowed to be imperfect.

The complication compounds when the client can't produce that earlier purchase record at all — an exchange that shut down, an account closed years ago, a wallet-to-wallet transfer with no receipt on either end. At that point "verify basis from the client's own records" means the client has to reconstruct the record first, and the reviewer is the one who has to ask for it.

Brokers must report gross proceeds for transactions effected on or after January 1, 2025. Brokers must report basis on certain transactions effected on or after January 1, 2026.

IRS, final regulations for broker reporting of digital-asset sales and exchanges

None of that is a flaw in the form. It's the rollout Treasury announced two years ago, phased in on purpose so brokers had time to build the systems basis reporting actually needs. What it changes is which step of this season's review can't be skipped: verifying basis from the client's own records instead of the broker's, on every digital-asset line a 1099-DA touches. That verification only pays off if it survives past this season — sitting somewhere a reviewer can find it next year, when the same client's next 1099-DA finally shows up with a basis figure to check against it, instead of living in an email thread or a departed reviewer's own files.