Blue chips or Bitcoin? Explaining IRS Forms 1099-DA vs. 1099-B

With a market cap in the trillions, cryptocurrencies are no longer a niche asset class. While the digital assets market is still smaller than established markets like stocks and precious metals, it’s mature enough for authorities to require standardized reporting. To increase transparency, the Internal Revenue Service now requires brokers to file a new form: 1099-DA. 

For traders with equities, Form 1099-DA shares some features with the traditional Form 1099-B, but there are key differences. Comparing Forms 1099-DA versus 1099-B makes it easier to understand the main components of 1099-DA, and knowing those differences can help traders estimate and file their taxes more accurately.

What’s a 1099-DA? Explaining the new IRS 1099-DA form

Form 1099-DA is a new information return from the IRS that reports cryptocurrency sales and exchanges made through custodial brokerages. U.S. lawmakers proposed it in the Infrastructure Investment and Jobs Act of 2021, with final regulations issued in 2024, to bring more transparency and compliance to the digital assets market. 

Starting in the 2025 tax year, brokerages that offer digital assets, such as centralized exchanges (CEXs), must issue 1099-DAs to all non-exempt U.S. taxpayers. Beginning in 2026, the form will also report cost basis – the original purchase price plus any fees – for covered digital assets.

Covered vs. noncovered assets

A digital asset is considered a covered asset if it was purchased on or after Jan. 1, 2026, and stays in the same brokerage account until it’s sold. In those cases, the brokerage must report the cost basis to the IRS on the 1099-DA. This definition mirrors how covered securities are treated on Form 1099-B.

If the asset doesn’t meet those criteria, it’s a noncovered digital asset. For example, it might have been bought before 2026, transferred between exchanges, or moved into self-custody. Brokerages aren’t required to report cost basis for non-covered assets, but they may include it in the customer statement if records are available.

The IRS also requires exchanges that offer tokenized versions of securities to report sales of those assets on Form 1099-DA (rather than Form 1099-B), since they are treated as digital assets for reporting purposes.

Just like digital assets, traditional securities are classified as covered or noncovered depending on when they were acquired and whether the broker had custody at acquisition. Cost basis and holding period are only reported for covered securities; for noncovered securities, brokers report gross proceeds only. In practice, this means both 1099-B and 1099-DA can have gaps in basis reporting, which is why taxpayers still need to track their own acquisition and transfer history.

Who receives Form 1099-DA?

Any non-exempt U.S. taxpayer who trades digital assets on a custodial brokerage will receive Form 1099-DA. Reportable activities include selling or exchanging any crypto assets, including the sale or exchange of crypto rewards earned through staking, yield farming, or mining, as well as selling non-fungible tokens (NFTs) on centralized platforms.

What’s Form 1099-B? 1099-B explained 

Form 1099-B, which reports proceeds from broker and barter exchange transactions, is also issued by centralized brokerages but covers the sales and exchanges of traditional financial assets. In addition to traditional financial assets like stocks, bonds, and ETFs, the form reports derivative contracts like options, commodities, and regulated futures contracts. 

Barter exchanges also issue Form 1099-B when individuals or entities trade goods or services without cash. For all these transactions, Form 1099-B typically lists key details such as the asset’s gross proceeds. In some cases, depending on the filer, additional information such as cost basis, acquisition date, and whether the gain or loss is short or long-term may also be included.

Who receives Form 1099-B?

Any non-exempt U.S. taxpayer who sells stocks, bonds, commodities, derivatives or other securities on a brokerage or who exchanged property or services through a barter exchange may receive a Form 1099-B. Because the form covers derivatives, some crypto exchanges are required to issue it if traders sold regulated futures contracts. Even if these contracts track the price of cryptocurrencies like Bitcoin (BTC), those sales are reported on Form 1099-B.

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1099-DA vs. 1099-B: Key differences

The differences between 1099-DA and 1099-B go beyond the assets they cover. While the focus on crypto versus traditional assets is the most obvious distinction, several other reporting standards set them apart.

• Asset type: Form 1099-DA reports digital assets, including cryptocurrencies and tokenized securities, while Form 1099-B reports traditional financial assets (such as stocks and bonds), barter exchanges, and certain derivatives.
• Issuer: Form 1099-DA is issued when a broker facilitates transactions in digital assets. Form 1099-B is issued when a broker or barter exchange facilitates transactions in securities, certain derivatives, or barter transactions. If a CEX offers derivatives such as futures or options, those transactions may also be reported on Form 1099-B.
• Cost basis info: Form 1099-DA doesn’t include cost basis for the 2025 tax year, though brokers may voluntarily report it. Beginning with sales on or after January 1, 2026, cost basis reporting will be required for covered digital assets. Similarly, Form 1099-B reports cost basis for covered securities when required; for noncovered securities, certain derivatives, and barter transactions, basis may be omitted and only gross proceeds reported. The biggest practical difference is that digital assets are frequently transferred between exchanges and self-custody wallets, so brokers may not always have complete cost basis information. 
• Holding period: Form 1099-DA may not include holding period information for the 2025 tax year. Beginning in 2026, brokers will be required to report the holding period for covered digital assets when they have that information. Form 1099-B also reports holding period information for covered securities. 
• Reporting form: Form 1099-DA and Form 1099-B both feed into Form 8949 and Schedule D for taxpayers to report capital gains and losses. 

Special tax filing considerations for 1099-DA 

Despite the IRS’s goal of using Form 1099-DA to improve reporting accuracy and increase compliance in digital asset transactions, traders can’t always rely on its details. Unlike Form 1099-B, which already reports cost basis and holding period information for covered securities, Form 1099-DA will not include these details for any digital assets in the 2025 tax year. Beginning in 2026, brokers will be required to report cost basis and holding periods for covered digital assets, similar to the way covered securities are reported on Form 1099-B.

As mentioned, covered assets only include cryptocurrencies bought on or after Jan. 1, 2026, that remain on the exchange before disposal. Anyone who bought cryptocurrencies before 2026 or transferred assets off the exchange may not get complete reporting from a 1099-DA. In those cases, traders must compile their transaction history manually or use software like CoinTracker to connect with exchange APIs and wallet addresses for full cost basis analysis. 

To sum up, 1099-DA gives the IRS more transparency into a taxpayer’s activity, but its scope is limited. That means traders still need to account for their entire crypto transaction history before completing their Form 8949 within their personal income tax return. 

Clarify 1099-DA crypto reporting with CoinTracker 

Even with forms like Form 1099-DA, reporting crypto transactions accurately isn’t as straightforward as reporting stocks. Because blockchain is decentralized, activities like decentralized finance (DeFi) and self-custody happen outside a CEX’s order books – and that makes them unknown to most exchange-generated forms.

The easiest way to present a complete, compliant record of crypto transactions is with tracking software like CoinTracker. After linking exchange APIs and crypto wallets, CoinTracker users get an instant view of their portfolio’s value along with a comprehensive transaction history. CoinTracker also automatically categorizes each transaction and compiles the data for Form 8949 and Schedule D. 

Download a free CoinTracker Portfolio Tracker account today and see how simple crypto tax reporting can be. 

FAQ

What’s the difference between 1099-B and 1099-DA?

1099-B is an established IRS form that brokerages and barter exchanges issue, most often for traditional assets like stocks, bonds, and ETFs. 1099-DA is a newer IRS form for digital assets like Bitcoin, Ethereum (ETH), and NFTs bought, traded, or sold on centralized brokerages. While there can be crossover – for example, with derivatives or tokenized securities – both forms report the proceeds from yearly transactions and, for covered assets, generally include information such as acquisition date, holding period, and cost basis when required and available.  

What crypto 1099 tax forms do exchanges issue? 

Custodial brokerages in the U.S. may issue several types of 1099 forms depending on a trader’s yearly activity. Starting in the 2025 tax year, they must issue Form 1099-DA to report proceeds from cryptocurrency sales. If the platform offers derivative contracts, it may also be required to issue Form 1099-B. Also, if a user earns at least $600 in income through the platform’s reward programs, such as staking services, the exchange will issue Form 1099-MISC. 

How do I report crypto taxes with 1099-DA? 

Use Form 1099-DA to fill in information on Form 8949, which then feeds into Schedule D. However, remember that only custodial brokers are required to issue Form 1099-DA, so you will also have to report any taxable transactions on decentralized exchanges. In addition, Form 1099-DA may not include cost basis information if you transfer assets off the exchange. For accurate tax reporting, keep detailed records of all transfers and on-chain activity to supplement the data on your 1099-DA.

Disclaimer: This post is informational only and is not intended as tax advice. For tax advice, please consult a tax professional.