In a significant regulatory update, the IRS has announced the introduction of Form 1099-DA, which will standardize tax reporting for cryptocurrency transactions. This new requirement is set to take effect for the 2025 trading year, with filings due in 2026. U.S. crypto investors are now faced with a pivotal shift in how they report earnings from their digital asset trades.
Starting in 2025, centralized exchanges and other brokers will be obliged to report gross proceeds from crypto sales through Form 1099-DA. While the reporting of cost basis will be optional in 2025, it will become a mandatory requirement beginning in 2026. Industry experts, including those from Acuity Scheduling, emphasize the importance of early preparation, stating, “Tax professionals can prepare now to assist their clients with reporting proceeds from certain digital asset transactions.”
The introduction of this form represents a shift away from self-reporting practices, aligning more closely with compliance standards seen in traditional financial sectors. This measure aims to mitigate discrepancies in tax reporting, particularly for investors utilizing multiple platforms, thus highlighting the necessity for meticulous record-keeping and strategic planning.
As the crypto community braces for these changes, concerns about compliance challenges have emerged. Tax professionals are urged to collaborate closely with clients to navigate the complexities of the new regulations effectively. The Coincu research team notes that enhanced regulation within the cryptocurrency space could lead to increased transparency in financial reporting, potentially attracting institutional investors and fostering market stability.
Currently, the price of Ethereum (ETH) stands at $2,979.50, with a market capitalization of $359.61 billion. Recent trading data reflects a volume of $18.87 billion, marking a 27.53% decline over the previous 24 hours. Although ETH has seen a 1.54% increase in the last day, it has experienced a more significant downturn of 32.12% over the past 90 days, according to CoinMarketCap.
As the 2026 deadline approaches, it is crucial for investors to proactively address these upcoming changes to ensure compliance and to leverage potential benefits from more structured reporting practices within the cryptocurrency market.
