Taxes 1099-DA : ce qu’il faut savoir | Bitcoin 2026

Hello everyone. My name is Sasha Hodder. I'm an attorney with Hotter Law Firm. Um, and today we're here to talk about the form 1099DA. Taxes got a lot more interesting and complicated this year with this form. And our panel of experts is going to be discussing what the form is, who it applies to, and what it means for you and your business. Um, so we'll start with some brief introductions. you can just go down the panel, please. >> Hi everyone, my name is Vic Patija. Um the owner of Commerce EPA. We're based in New York City. Um I used to work at EY in the hedge fun tax department and I started my own firm about 10 years ago. We have a couple hundred clients in the space uh between crypto and traditional. Uh we find that crypto is a part of people's portfolio. So, we're able to manage both the crypto and non-crypto piece and provide expertise and tax planning around those areas. Uh, we've seen several 1089DAS and looking forward to helping you guys out and answer any questions. >> Hey, good afternoon. My name is Jordan Guest. I run a CPA firm called Satoshi Paci. We're based out of uh Nashville and we have an office in Louisville, Kentucky as well. And I also am a co-founder of a Bitcoin accounting and tax software called Bitmint that honestly I convinced uh my software engineer co-founder to build for us because we were tired of using QuickBooks alongside uh Coinly or Coin Tracker. And so I'm excited to dig into the 1099DA form reporting today. >> Hello everyone. My name is Andrew Gordon. I'm an attorney and CPA and our practice helps crypto investors report crypto in their taxes. And on our law side, we also help people with when things can go wrong, audits, criminal investigations, and in the last year or so, I've been in DC advocating for crypto tax changes because crypto taxes, quite frankly, are broken. They need to be fixed. And so, I'm fighting to do that. >> Thank you. And I guess for the first question, let's just start with a very basic overview. What is the 10 1099 DA? uh down the road. >> Uh the 1089DA is a 1099 issued by the usually by the exchanges. Um and it breaks down whether the cost basis has been reported to the IRS or not. Um and then clients are issued those. In my in my in my experience, a lot of them uh sometimes they're accurate, sometimes they're not because sometimes the crypto exchanges don't know the original cost basis of when the client bought it. So if they bought it on Coinbase and transferred it to Gemini and they have proceeds on the Gemini level, they'll give attending an NDA for the girls proceeds, but they won't know the cost basis. So sometimes it creates a mess for the client because they'll have a large potential capital gain. So we kind of go in and reconcile the crypto between the different exchanges and wallets to to give them an accurate uh cost basis. So it's like it's like a double-edged sword in a way. I know I know they're trying to make it more compliant, but it's also causing a lot of hiccups. >> And if I may just add to that, let's talk a little bit about why we're actually here talking about 1099 DAS. Uh crypto taxes unlike anything else in the modern financial world. When you trade stocks or have investments, the brokerage issues you a beautiful form called a 1099B, and it has everything you need to report crypto on your taxes. It has your cost basis, your sales price, gains and loss. You take that form, you give it to your accountant, you plug it in Turboax, and away you go. You don't have to sit there calculating the gains and losses on every transaction. But with crypto, it's not that way. For the last decade plus, it's been on us as the individual investors to report on our own. And if we get it wrong, then we're facing audits or even worse. So finally with the government's infinite wisdom they decided well we need to have some sort of form so we have more information on the actual trades and hopefully over time make it easier for people to report on their taxes. And so starting this year 2020 tax year 2025 the tax form was issued in 2026 over the last month or so. Uh now the IRS is starting to require exchanges, brokers to take some of that responsibility off of all of us and generate these forms so that we can actually have an easier time preparing our taxes. But as we'll talk about, it's it's not that simple. Uh for this year, as he had mentioned, they're just reporting sales proceeds. So what the IRS is getting is a very limited picture of what's actually happening. They're seeing what you sell it for, but they don't know your gains or cost basis. And this is going to cause a lot of problems. It already is causing a lot of problems. So, it's a good thing that we're moving towards a system where it's not on all of us to have to do these calculations, but in the meantime, we're going to feel a little bit of pain because the the form just isn't all that it needs to be just yet. The only thing I would add to to both of those really good explanations is that you the exchanges have over the course of the last year or so have been going to all of their customers and saying please give us your cost basis data and as anyone in this space knows if you've been in it for long enough that is not the easiest thing to track down especially if you started buying in one place maybe you mine Bitcoin maybe you earn Bitcoin in your small business all of those uh cost basis events, you know, create that lot um or a bunch of different lots and then you might batch transfer a bunch of lots onto an exchange to sell it to buy a home or to cover business opex and then you're having to go through and actually assign those lots. And to Andrew's point, yes, generally Fidelity or Schwab would do this for you if you had Apple stock or Tesla, but now we're the IRS is looking at all of us and saying you need to become an expert in uh tracking transactions and making sure that you uh that you report that to us correctly. And then the very last thing I would say is the cost basis method. I'm sure we'll get into that as well, but um that is one last piece, right? you could give them cost basis data but they are going to by default use FIFO and uh sometimes that that's not the most optimal uh tax strategy for reporting on the cost basis. So >> yeah interesting times and can can you go over who is required to issue these 1099Ds? I know it was several years of debate of who's going to be considered an actual broker. So where did that line fall and whose responsibility is it to issue these? >> Um for my experience I think it fall the that that responsibility falls at the exchange level and I if I were to guess is probably US-based exchanges um like Coinbase uh Gemini I might have seen a Kraken but I'm not sure if Kraken is Asia or is it US-based but I think it falls at the it falls at the responsibility of the exchange for sure. uh the wallets aren't issuing them even if the wallets are doing like DeFi if you're using MetaMask. I think it's really at the US regulated exchanges. So, a couple years ago there was a law passed that required brokers to start issuing this form and at first there was a lot of ambiguity as to who is a broker. Is that just a US centralized exchange like Coinbase or Kraken? Or is it also things like DeFi? Is is it like unis swap for instance? And at first the definition of broker was quite expansive. It would have required that even DeFi platforms would issue these forms as well. Fortunately with the new administration, one of the first acts that occurred was a change to this law so that it only applied to US brokers, US crypto exchanges. Uh again, Coinbase, Kraken, Gemini, and the like. Now, that means that the DeFi brokers are not reporting on the 1099DA, but that doesn't mean that we can just ignore those trades. This is just another gap in reporting. Now, it's on all of us still to report all of those trades, reconcile them with the US brokers as well. But fortunately, very fortunately, as of now at least, it doesn't apply to these DeFi type exchanges. But this is something that may change over time. And so, we need to still be involved. We need to make sure that as the this administration and future administrations legislate that it doesn't become overly broad and apply to DeFi. These are these decentralized exchanges don't have information on exactly who's using them. And in order to issue these forms, they're going to start having to do KYC on all of us. And that's kind of the opposite of crypto. And we certainly don't want the hap that to happen. So right now it's a limited view, but that very potentially could change in the future. >> And how realistic is this wallet bywallet accounting? Like the numbers that Coinbase reports, you know, wouldn't be the full picture. If a person is, you know, buying on Coinbase, moving to their ledger, maybe doing some activity on different exchanges, there's no way for one exchange to capture someone's entire um crypto transaction. So, h how do you reconcile that for your clients? >> I mean, what I've seen in practice so far is that it is just a mess, right? I mean, there's not really a better way uh to say it because Fidel, if you hold Apple stock in a Fidelity account and you hold Apple stock in a Schwab account, those have their own assigned cost basis. They issue their own 1099s. And to your point, Coinbase is trying to find lots. Well, maybe they're using they might they're they very well may be using lots that have actually already been used in previous tax years if it's not been tracked uh correctly or they might be using lots from a different exchange. And so you have doubling up of lots. The reconciliation piece here uh especially for people who are like I just wanted better money. I just wanted to uh you know reduce the credit card fees that I was having to pay for my business in order to accept Bitcoin. Now all of a sudden they have to become experts in you know tax reporting and cost basis tracking and it's it's really just not sustainable. >> Yeah. For us to add to that we use uh software to integrate with all the wallets and exchanges. So we get all the trades and uh there's always it's not it's not perfect because some of these wallets and exchanges they don't provide any data past a certain date. Some of them are maybe like 30 days of data. So very often if there if there's a really active trader on many especially someone who's who's been trading for a while on many different obscure exchanges very commonly like there's zero cost basis or inaccurate cost basis. So no one knows better than the client themselves like what they bought that asset at. So if worse comes to worse what we what we've done is um we we've asked the clients really simply hey this is showing zero cost basis but clearly there is some sort of cost basis. So we we sometimes we use a 50% cost basis just to have some sort of like reality check because 0% or 100% cost basis is not reality. So we try to we try to estimated it between like 25 to 75% of cost basis if that's what we end up having to do. Um so that's just the nature of the piece like you know like Andrew um and he has mentioned before you know when you're trading on Fidelity uh and Erade all the exchanges that they talk to each other. So the cost space is is reported even if you even if you're transferring assets from one one exchange to another, but in crypto like it's not regulated as much. So Coinbase and Gemini, they don't talk to each other. So it's on us as a tax repairer and the tax payer uh to really get down to the nitty-gritty what the accurate cost basis is to the most reasonable amount we can. And obviously some some of these tokens are either worthless or they bought them years ago. So it gets it gets a little difficult. But again, it's a two-way street with us and the client and then we just try to report it on a transaction fortransaction basis. So this way they're covered. >> Do you ever um get any subpoenas from the IRS? Like if they're able to collect the information from the exchanges, they might also start wanting to know from the um the tax software so that they can get a full picture. Has that started happening across the industry? Well, I haven't seen any subpoenas to the tax software specifically, but historically there have been what's referred to as John Doe summones issued to crypto exchanges. Coinbase was one of the first, then uh Kraken and then Paloniex, a non US exchange got acquired by a US company and then they were summoned by the IRS. And what is a John Doe summons? It's basically a summon that requires that the uh company provides information on all taxpayers that fall under a certain threshold. So, they're not targeted summones. The IRS is just saying, "Feed us all the information you have on anyone that traded, for example, over $10,000 a year." And we've seen this happen several times. And what this creates is this big issue where the IRS has all this information on what people are doing, what they're trading. Yet, even in some cases, the taxpayers themselves can't even get that information. Paloni's closed down, restricted US users can't even get that data. But the IRS has it. And now with that information, we've seen them sending out letters, notices, at best, just a warning, at worst an audit. We've seen these audits happening time and time again. We talk about regulation by enforcement, right? is a big uh term that people use all the time with the SEC. But the one bo government body that's doing that more than anyone else is the IRS. They're auditing taxpayers. They're auditing businesses using the information that they've received, but at the same time not providing the rules of the road. They're not showing us what's taxable and what's not. For example, wrapping and unwrapping a token. You could ask the three of us up here. may all have different responses on whether or not that's taxable. So, we've seen this large increase in the information the IRS is receiving. We've seen an increase in audits, unfortunately, even some criminal investigations, but at the same time, we don't have those rules of the road, and that's something that we desperately need. >> Absolutely. Yeah. Um, do you have any interesting client antidotes of uh, you know, filling out this form 1099DA or in general of h how people are handling crypto taxes? >> I would just jump in real quick. I mean, something we saw this tax season quite a bit is well, one, we got a lot of 1099 DA forms like you mentioned that were blank on the on the cost basis column. And so then we're having to go through and build that cost basis schedule and um and then we can help them do specific identification cost basis method to say okay let's use this lot and generate this smaller gain or this larger loss. Um and we've seen that also with some of the DA forms that did have cost basis data but we elected to use the specific identification method and actually bring the liability down. But to your point, we've already prepared the client to say, "Hey, almost certainly we're going to get a notice about this and we're going to have to show our work to the IRS about how we came up with the cost basis data um because it's not going to match the form that they got um from the exchange you use." So, I think that's the biggest thing is if you're diligent about using the correct cost basis method, you can show your work, you can actually save the client quite a bit of money and you and keep those lots that are lower cost basis from prior years. keep those saved, let the client take loans against those over the course of, you know, their investing career and and uh decrease the tax liability that way. >> So, I've got an audit story that I'd like to share. Uh we had a client and fortunately this audit ended recently and we even had to take it to tax court to get there, but it's a demonstration of exactly how things can go wrong. uh the they were using a US exchange and that US exchange reported to the IRS on a form called a 1099B and this was during a period where there was a lot of uncertainty and whether or not uh exchanges had to use this form and this form showed their sales of stable coins. Now we're all Bitcoiners here, right? We we we only hold Bitcoin, but we know a little bit about stable coins. And with the little that we all know, we know that it's pegged dollar for dollar. However, when this form was issued, and these 1099Ds are still being issued, they're only showing that the stable coins are sold for a dollar, not the price that they were bought at. And so, our client didn't report about $100,000 of stable coin sales on his tax return, figuring, well, it's it's dollar for dollar, zero gain. Why do I need to take the time and effort to report stable coins? So, what did he get? Well, he got a bill from the IRS. He got a bill showing that those stable coins were a complete gain. Zero cost basis, 100% gain. Now, excuse my language, but that's It's a it's a waste of everyone's time, and it's not the way things should be. The IRS, if they had someone there that knows the basics of stable coins, they would know that it's pegged to a dollar. You shouldn't spend time auditing or issuing a notice to someone that didn't report stable coins on their taxes. And again, we had to take this all the way to tax court in order for the IRS to concede and realize that yeah, it's dollar for dollar, there's no gains. That's a lot of time, money paid to us, which happy to take that money, but time from the IRS that they could be doing other things. And while this is a very simple example, stable coins, this same thing is going to happen to taxpayers day after day who don't report all of their transactions from the 1099 forms on their taxes. And that's because again that requirement is on us in order to report the cost basis and if we don't even with simple things like stable coins the IRS can assume that it's a complete gain. >> Also in my experience I kind of feel like we we we've seen notices that clients get like similar to what Andrew >> your name again >> Jordan >> and Jordan have said like they get these ridiculous 1089s uh from the or the tax bills from the IRS saying hey you didn't report these girls proceeds and we'll do the reconciliation. and we'll respond to the notice. We'll we'll give him a detailed $8949. We might even amend a tax return, refile it, and just kind of just goes away and you know, like I mean, of course, Andrew went to tax court. That's a that might be a different story. But I feel like the IRS knows like they don't know what the hell they don't know what like they don't even they shouldn't be even issuing this stuff. But as soon as we respond, it just kind of goes away. like as opposed to other notices in different regions like a traditional business like they they'll they'll they'll fight back with us you know like if there's if there's an audit there'll be some back and forth but in crypto audits I find that once we give them a proper reconciliation report they kind of know they're in the wrong cuz they giving these ridiculous tax bills to people that aren't even just cuz you know tax law 101 or any any law 101 that like this the the the enforcement has to reasonable and just. When a client's getting a like a ridiculous tax bill for something that's not even accurate, it's not reasonable and just. So, you know, we kind of respond back with that kind of antidote. And from my experience, you know, we have beaten audits with that type of approach. >> Oh, your your clients must be grateful when that happens. It's so nerve-wracking to get those letters. >> Yeah. Except for the processing time. >> Yeah. Um, and who do you think the IRS is going to come down harder on with this new 1099DA form for non-compliance, the exchanges or or the individuals? >> I I think the um at the end of the day, I think we can all agree that the uh the responsibility starts with the taxpayer to report reasonable capital gains and losses. I mean, it's the the tax law has been around since 2014 for crypto. At least it's been mentioned. So no one they can't I don't think they can play the ignorance card anymore. They they probably could for a little while but I think nowadays it is mainstream enough to know that it has to be reported. So the exchanges are doing their best but I think at end of the day I think we all agree that falls on down with the taxpayer. Mhm. >> Yeah. I mean, I would just say to add on to that, yeah, every everyone who gets into Bitcoin, uh, you do, for better, for worse, you do have to think through how are you going to, you know, track your transactions. And it does, you know, there's a lot of Bitcoiners that I know that like to try out every wallet and send Bitcoin from here, there, yonder, and um, you know, you have to track, are those, are those hops, are they transfers? Are those are you actually sending Bitcoin to someone to pay them for services? says, "Okay, that's taxable. Transfer is not taxable." And so I always just tell someone if you're just starting out, you know, try to keep it simple. Do your research on the different exchanges and in a best case scenario, you use one exchange, you send it to cold storage, and you don't have to end up having to have all this history, right, of all these different exchanges and trying to track all that down. Easier said than done, of course, if you've been in Bitcoin for, you know, longer than five years. So, >> yeah. And and another good point to realize is that although this form is just being issued now for tax year 2025, that doesn't mean that you can ignore all of the past, all the other trades that you've done. I I talk to clients all the time that have years of reporting that they haven't done and now they're getting a 1099 DA realizing they need to report on their taxes. There was a recent report that said 49% of people don't know that cryptoto crypto trades are taxable. And there's even a larger amount of people that haven't reported crypto on the in the past on their taxes. Now with this form, it's not just this year that we need to worry about, but even reporting prior years. So we work with a lot of clients to get the old years cleaned up because right now the IRS is typically auditing a couple years back. And it's not going to be for a few years until they're even looking at 2025. So unfortunately, this isn't just something that we can view tax year 2025 in isolation, but we've got to have it all cleaned up to have that cost basis that transfers year-over-year. We can't just start in this year because if we do, we'll have basically no cost basis or history. So unfortunately, it's usually a bit of a cleanup project to get everything organized for for the prior years so that we can report accurately this year. And how far back can the IRS go if if someone was an early Bitcoiner and is just now starting to to clean up their taxes? Like how how far is that window before they're in the clear for maybe the the earlier years or will they ever be? >> Sure. So the IRS generally has three years to audit from the date of your filing or the due date, but that can extend to six years if there's a gross understatement of tax of 25% or more. And in the crypto world, especially if you're getting audited, for the IRS to prove or try to argue that it's over 25% pretty easy. And then making it even worse, if you were uh part of any of these John Doe summones, for example, Paloni, they took about three, four years to even respond. And so now the IRS is saying, well, if you traded on Paloniex, we don't just have three years to audit you. We got those three years plus an additional three or four years. So unfortunately, it's a pretty long time period. At a minimum, we usually advise clients to go back at least three years, but in a lot of cases, even six. >> Yeah. Yeah. And also to Andrew's point, um, in my experience, if a client hasn't reported it at all, what we'll do is we'll we'll we'll go back and do the reconciliation from inception and then we'll we'll see like which tax years were significant enough to amend and which years we can just true it up. Often sometimes, you know, we find that we can just true it up in the current year as a mistake for prior years, unless there's one year that was like really significant, then we can just amend that one year. Um, now sometimes if they're at a loss, one may argue that they don't need to report it. Uh, but especially if they're they're at a gain, they had to report it. Um, so obviously past 3 years, you're not able to get a refund, but you might be able to get a credit for future years if you if you do a refund. >> Welcome to predict. The world is a market. Everything is a market. Every headline moves the line. Every moment is your market. Call the moves. Bet on your instinct, your prediction, your edge. Dual bits. Predict where everything is a market. >> And are there any tips you have for people to avoid getting audited or like how does the IRS choose who they're going to audit? I mean, I would just say whatever you put on your tax return, make sure that you have the work papers, your your CPA has the workpapers to justify uh what you put on there and and going to to Andrew's point, going back all the different years, you could have capital loss carry forward. that you've got to reconcile with for you know maybe you had that in 23 and or 22 I guess would be a better example right when there was a big crash and then you've got to pull those forward but I mean it's there's a lot of these notices that are going out that are it's automated um man I'm I'm really hoping that the IRS does not figure out about AI and uh and being able to because all these transactions are are on public blockchains right and so if they have your address to your point about now they have all this information about you they can chain analysis can go in and uh they can track, okay, this person plugged in their driver's license and they KYCed on this exchange. Then we can see that they send it over here and they use probabilistic u you know math to say okay we're 95% sure that all these different hops are still the same person and then they're going to issue you know they're going to say okay you owe taxes on all this stuff not just what happened on the exchange. So, I all that say I would just try to get everyone to take this stuff seriously. Work with, you know, work with someone on the stage here so that you know that you've uh you've got all your uh ducks in a row. >> Yeah. And sorry to be the bearer of bad news, but the IRS has started to use AI and they're only going to increase doing that. So, how do you avoid an audit? Number one, make sure that if you get a tax form, a 1099A, 1099B, whatever it may be, include it on your taxes. you if you ignore it, you're basically asking for a notice. Number two, be thorough. Include all of your exchanges, all of your wallets. Everything needs to be reconciled, not just what's on those forms. And number three, get involved. Uh we're hosting a happy hour at 6:00 today at Chica to talk about these issues, talk about policy, how we need the IRS to stop enforcement. So, come join, share your stories with us, and let's hopefully make some changes where the IRS isn't just going after crypto investors without having the actual resources to know what those gains actually are. >> Yeah, I agree with them with Jordan and Andrew. I mean, reporting transaction by transaction is the key. And to Andrew's point, even if you get a 1089 DA that's not accurate, in my opinion, with any with any 1089 sometimes not accurate or even a W2 or whatever, still report it. So that so the IRS records match your returns as it own mismatch notice that comes a few months later. But then you can I would I would we usually reconcile it and report the accuracy. So this way your tax bill is still what it should be but still matching the IRS records. This way at least you don't have to deal with like the mismatch of a of a 1080 a particular 1089 is pretty is pretty key as well. One one last quick thing to add would be, you know, sometimes we have seen it like I remember this past tax season there was a transfer out that was marked as a you know was a big transfer and they marked it as a taxable transaction and we had to end up going back to the exchange and and requesting that they issue a corrected 1099DA. So that's another option as well just so that they're you're you're not just asking for trouble because the IRS got this form and you know potentially end up in tax court because of it. >> Yeah. And don't just trust the 1099 DAS either. We've seen quite a bit of mistakes and and not to name names, but Kraken has been issuing uh revised 1099 DAS even after the tax deadline. And you know, I I don't want to curse, but WTF like how how can we file our taxes on the deadline and then the exchange issues a corrected form. So don't trust what's just on those forms. Make sure that they're verified. work with a professional, one of us, uh, to get it right because whatever you're going to spend with us, you're going to spend infinitely more if the IRS comes to you and you've got to deal with an audit or even just a notice. >> Very good. And one last quick question. Do you think this form made things better or worse? Like, is it a an improvement for everyone to have these forms and this information from the exchanges? >> I think recorded. I think overall, yeah, I mean, it's a step in the right the right direction, but it it is causing a mess. >> Yeah, long term it will be better, but we're going to have quite a bit of ba pain first. >> Yeah. All right. Well, thank you gentlemen and thank you everyone for coming. Every year this community comes together to celebrate, to debate, to build what comes next. And every year the stage gets bigger. Sound money center stage. So where do you go to celebrate the next chapter in Bitcoin history? You come home. Nashville, July 2027.