Crypto Form 1099-DA (2025 Trades Onward): Custodial Broker Reporting, DeFi Rule Repealed, Compliance Planning

Author: Gloria Liu, CPA ｜ YCL Tax, Accounting & Advisory

Bottom line in one breath

U.S. custodial brokers (centralized exchanges, hosted wallets, certain kiosks/processors, etc.) must report digital-asset sales and other dispositions on Form 1099-DA to you and the IRS. For 2025 activity, reports often emphasize gross proceeds; basis frequently remains the taxpayer’s job. No 1099-DA does not mean no reporting. Congress disapproved the IRS DeFi/noncustodial broker reporting rule via H.J.Res. 25 (P.L. 119-5, Apr. 10, 2025)—that rule has no force. The GENIUS Act builds a payment-stablecoin regulatory framework; it is not a blanket income-tax holiday. As of September 2026, reconcile every 1099-DA to your own ledgers—compliance planning.

Background

Digital assets are generally treated as property: sales, exchanges, and payments for goods/services can trigger gain or loss. 1099-DA pulls custodial brokerage channels closer to securities-style information reporting. Separately, Congress blocked an expansion that would have swept in many DeFi front ends. GENIUS (2025) focuses on stablecoin issuance/reserves; tax characterization still follows the Code and IRS digital-asset guidance unless new notices say otherwise (待核).

Old vs. new

1. Information reporting: Sparse / self-kept records → widespread 1099-DA from custodial brokers.

2. Tax year 2025 content: Often proceeds first; basis boxes may be blank/incomplete → taxpayer computes basis.

3. 2026+ trajectory: Broader basis reporting for covered assets acquired and held at the same broker—confirm current instructions (待核).

4. Foreign exchanges: May issue no 1099-DA; U.S. tax reporting still required.

5. DeFi regulation: Proposed broker expansion → disapproved; ineffective.

6. No form, still file: IRS is explicit on this point.

7. Stablecoins: GENIUS ≠ automatic nontaxable transfers—watch facts and guidance (待核).

8. Corrections: Ask the filer for a corrected 1099-DA; the IRS will not fix it for you.

Self-check: does this affect you?

1. You traded on a U.S. custodial platform and may receive 1099-DA in spring 2026.

2. You used only on-chain DeFi, got no form, and assumed silence equals nontaxable.

3. You transferred coins across venues and lost basis history.

4. You move large stablecoin balances without analyzing dispositions.

5. Your 1099-DA totals disagree with exchange CSVs.

Simplified examples (illustration only; ignores fees, wash-sale analogs, mining ordinary income)

Example A — custodial sale: 2025 U.S. exchange BTC sale; 1099-DA shows $50,000 proceeds, blank basis. Illustration: compute basis from your records, then file Form 8949/Schedule D.

Example B — no 1099-DA swap: Noncustodial wallet swaps ETH for another token. Illustration: may still be a taxable exchange at FMV—even without a form.

Example C — bad form: 1099-DA overstates amounts. Illustration: request a corrected form from the filer; report correct figures and keep correspondence.

Action timeline

1. Export 2025/2026 CSVs from every venue; merge with on-chain records.

2. Reconcile each 1099-DA; chase the broker on mismatches first.

3. Complete basis, especially for 2025 proceeds-only forms.

4. Bucket income: trading gains vs mining/staking/airdrops (facts 待核).

5. Watch whether the year’s instructions expand mandatory basis reporting (待核).

What YCL can do

1. Build exchange/wallet workpapers and tie out 1099-DAs.

2. Separate custodial reported activity from DeFi self-calculated items.

3. Prepare Form 8949/Schedule D and digital-asset questionnaire answers.

4. Monitor post-GENIUS IRS stablecoin tax developments (待核).

5. Bilingual Cary (RTP) + Shanghai—CPA Chenchen Liu and Gloria—compliance planning.

FAQ

Q: If I never get a 1099-DA, can I skip crypto on my return?

A: No. Taxable transactions still must be reported.

Q: Is DeFi permanently free of information reporting?

A: The prior DeFi broker rule was disapproved; future legislation/rules could change the landscape (待核).

Q: Did GENIUS make stablecoin transfers tax-free?

A: No automatic exemption. Regulatory law ≠ income-tax holiday—follow IRS digital-asset rules (待核 new guidance).

Book a consult

YCL Tax, Accounting & Advisory

Web: yclcpa.com ｜ Email: info@yclcpa.com

Phone: 919-802-8376 / 980-202-0666 ｜ WeChat: YCLUSA

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Disclaimer

This article is general tax information only—not tax, legal, or investment advice. Digital-asset tax and reporting follow IRS form instructions and current notices. Items marked 待核 require verification before filing. Consult a licensed professional. Crypto prices are volatile; this is not investment advice.