Form 1099-DA for 2026: Box by Box, and the First Year of Cost Basis

The short answer. For tax year 2025, Form 1099-DA reported gross proceeds from digital asset sales and nothing else — brokers were not yet required to report your cost basis, whether or not the asset qualified as covered. Tax year 2026 changes that, but only partway. Basis reporting becomes mandatory for digital assets that are covered securities: coins, tokens, or other digital assets acquired on or after January 1, 2026, inside a custodial broker account, and that stayed there until the broker processed the sale. Anything already held going into 2026, anything transferred in from another wallet, and anything that left custody along the way remains noncovered, and basis reporting on those lots stays voluntary. That single distinction — covered versus noncovered — does almost all the work on the 2026 form, the same way it does on the stock-and-bond sibling of this form, Form 1099-B.

What actually changed between the first year and the second

The 2026 Instructions for Form 1099-DA describe the shift plainly: for sales a broker has effected after 2025, gross proceeds reporting is mandatory for every digital asset, basis reporting is mandatory for covered securities, and basis reporting is voluntary for noncovered securities. That is narrower than it sounds. It does not mean every 1099-DA for 2026 will show a cost basis; it means brokers are on the hook for basis only on the newest layer of your holdings — coins bought after the custodial relationship with that broker began, on or after January 1, 2026, and never moved out of that account.

Everything acquired before that date is noncovered by definition and stays that way indefinitely; no future year turns a pre-2026 purchase covered just because time passes. The same holds for a coin bought in a 2026 custodial account and briefly withdrawn to a hardware wallet before being sold back through the same broker — leaving custody breaks the chain the mandate depends on. A broker can still report basis on a noncovered lot voluntarily, and picks up a modest protection for doing so: checking box 9 (noncovered security) shields it from certain penalties if that voluntary figure turns out wrong.

The form, box by box

The 2026 Form 1099-DA carries more boxes than the 1099-B, mostly because it has to describe an asset (box 1a’s code, box 1b’s name) rather than just a security your broker already has on file. Here is the full layout, transcribed directly from the form and its instructions for recipients.

Box	What it reports
Applicable checkbox	Which Form 8949 category box (G through L, or Y) the transaction routes to
1a	Code for the digital asset (the Digital Token Identifier Foundation code; “999999999” if unregistered)
1b	Name of the digital asset
1c	Number of units sold
1d	Date acquired
1e	Date sold or disposed
1f	Proceeds
1g	Cost or other basis
1h	Accrued market discount
1i	Wash sale loss disallowed
2	Check if basis was reported to the IRS
3a	Reported to IRS: gross proceeds, or net proceeds
3b	Check if proceeds are reserved for future use, or from a qualified opportunity fund
4	Federal income tax withheld
5	Check if a loss is not allowed, based on the amount in box 1f
6	Gain or loss character: short-term, long-term, or ordinary
7	Check if box 1f is cash only
8	Check if the broker relied on customer-provided acquisition information
9	Check if the digital asset is a noncovered security
10	Reserved for future use
11a	Check if box 1f is an aggregate amount for qualifying stablecoins or specified NFTs
11b	If 11a is checked, the number of transactions aggregated
11c	Aggregate gross proceeds of specified NFTs from first sales by a creator or minter
12a	Number of units transferred in
12b	Transfer-in date, if units were transferred in
13	Reserved for future use
14–16	State name, state identification number, state tax withheld

A few boxes deserve a second look. Box 1a’s code identifies the specific digital asset technically; box 1b’s plain-language name is what you will actually recognize. Box 6’s “Ordinary” option exists because some digital asset dispositions carry ordinary-income character rather than capital gain or loss — worth flagging to a preparer rather than assuming away. And under the optional reporting method described next, a long list of boxes — 1d, 1e, 1g, 1h, 1i, 2, 3a, 3b, 5, 6, 8, 9, 12a, and 12b — can simply be left blank. If your form has fewer entries than the table above, that is very likely why.

The de minimis rules: when a broker can report in bulk instead of lot by lot

Three categories of transaction get a break from the usual one-line-per-sale reporting, each with its own dollar threshold measured against a customer’s total for the year.

Payment processor sales. A broker is not required to report a customer’s sales through a processor of digital asset payments (PDAP) at all, if that customer’s PDAP sales for the year total $600 or less. Cross that line, though, and the rule flips entirely: every one of that customer’s PDAP sales for the year must be reported, not just the amount above the threshold.

Qualifying stablecoins. A broker is not required to report a customer’s designated stablecoin sales if the customer’s aggregate gross proceeds from all designated stablecoin sales through that broker, net of allocable transaction costs, come to $10,000 or less for the year. A qualifying stablecoin, here, is one designed to track a single government-issued currency one-to-one, uses an effective stabilization mechanism, and is generally accepted as payment by people other than its own issuer.

Specified NFTs. The same style of exemption applies to specified NFTs — indivisible, unique tokens that do not themselves carry an interest in other excluded property — with the threshold set at $600 of aggregate gross proceeds, again net of allocable transaction costs.

When a broker elects the optional aggregate method above those thresholds, boxes 11a through 11c carry the summary: 11a marks stablecoin or specified NFT, 11b shows how many transactions got folded into the figure, and box 1f becomes an aggregate rather than a per-lot number. Stablecoins get a stricter rule — once $10,000 is crossed, the broker must file a separate form per stablecoin type. Specified NFTs can generally all share one form, except that proceeds from first sales by the original creator or minter must be broken out separately in box 11c on a second form, with box 1f left blank there.

Wallet-by-wallet basis, and where that habit came from

If your broker’s 2026 statements track cost basis separately for each wallet or sub-account rather than pooling it across your whole relationship with that broker, that is not a new 2026 feature — it is the tail end of a transition that already happened. Revenue Procedure 2024-28 gave taxpayers a one-time safe harbor, effective January 1, 2025, to allocate their existing, unused basis across the specific wallets and accounts where their digital assets actually sat, moving them off the older universal, FIFO-style basis tracking many had used across an entire account relationship, and onto the wallet-by-wallet method the current broker regulations require.

That election is history by now, not a 2026 action item — it had to be made as of January 1, 2025, with only narrow exceptions tied to a taxpayer’s 2025 return. It matters here only because it explains the plumbing: 2026 basis reporting is organized account by account precisely because this earlier transition set it up that way.

Backup withholding: paused for 2026, not eliminated

Two IRS notices govern whether a broker has to withhold 24% and send it to the IRS on a digital asset sale. Notice 2024-56 first laid out transitional relief from backup withholding and related penalties for digital asset brokers, and Notice 2025-33 extended and modified it. The headline holding: backup withholding under sections 3406 and 3403 is not required on any digital asset sale a broker effects during calendar year 2025 or 2026. Two other pieces ride along: brokers can keep relying on uncertified taxpayer ID numbers for preexisting customers, verified through IRS TIN Matching, for sales through calendar year 2027, and if a broker does withhold and the withheld asset’s value drops before liquidation, its exposure is capped at what it actually nets from an immediate 24% liquidation.

None of this changes what you owe. It only pauses the broker’s obligation to skim and remit withholding on your behalf — for 2025 and 2026 sales, in most cases, there will not be any withholding credit to look for on your return.

A separate notice, 2024-57, spares brokers from filing information returns at all on a specific list of transactions, “until the Treasury Department and IRS issue further guidance”: wrapping and unwrapping, liquidity-provider transactions, staking, transactions described as lending or short sales of digital assets, and notional principal contract transactions. The exception does not extend to rewards or other compensation earned through those activities, which stay reportable on their own terms.

The DeFi broker rule that never took effect

In December 2024, Treasury and the IRS finalized a rule (TD 10021) that would have pulled non-custodial, DeFi-style trading front-ends into the definition of a digital asset broker, effective February 28, 2025. It did not survive. Congress disapproved the rule under the Congressional Review Act — the House passed the disapproval resolution in March 2025, the Senate followed, and the President signed it into law as Public Law 119-5 on April 10, 2025. A disapproved rule under the Act is treated as though it never took effect, and the Federal Register notice formally removing it from the Code of Federal Regulations became effective July 11, 2025.

The practical result for 2026 reporting: the “broker” and “digital asset middleman” definitions that actually govern Form 1099-DA are the earlier, narrower ones, and no DeFi-specific broker category applies. Trade through a genuinely non-custodial DeFi front-end and do not expect a 1099-DA from that venue on the strength of this repealed rule.

Where it lands on Form 8949

Digital asset sales get their own set of category-box letters on Form 8949, distinct from the stock-and-bond letters A through F. The Instructions for Form 8949, in the revision covering returns filed for tax year 2025, introduced boxes G, H, and I for short-term digital asset transactions and J, K, and L for long-term ones, explicitly instructing filers not to use the old box C or box F for digital assets. A seventh code, Y, covers a transaction where the filer cannot tell whether the holding period was short or long.

Code	Meaning
G	Short-term, basis reported to the IRS
H	Short-term, basis not reported to the IRS
I	Short-term, no 1099-DA or substitute statement received
J	Long-term, basis reported to the IRS
K	Long-term, basis not reported to the IRS
L	Long-term, no 1099-DA or substitute statement received
Y	Holding period unknown

The logic mirrors the older stock codes, shifted one alphabet block over: G and J are the “covered and reported” boxes, H and K are for a 1099-DA that arrived without a basis figure, and I and L are for sales with no 1099-DA at all. The column (f) and (g) mechanics for correcting a broker’s figure are covered in the Form 8949 column (f) adjustment codes page. One thing this guide is not verifying: whether digital asset sales are subject to the wash sale rule the way stock is. That question belongs to the wash sale Form 8949 code W and column (g) page, which is specifically about how wash sales get coded — consult it directly rather than assuming an answer here.

A caveat worth sitting with: these codes come from the Instructions for Form 8949 covering tax year 2025 returns, the most current revision available as of this writing. No tax-year-2026-specific instructions have posted yet, in draft or final form. It is reasonable to expect the codes to carry forward unchanged, since they are defined by the underlying broker regulations rather than the 8949 form itself — but until the IRS posts 2026 instructions, that continuation is an inference, not a confirmed fact.

A worked example: a covered lot, start to finish

Here is a simple, entirely hypothetical case to see the mechanics move. Say you open a custodial account in early 2026 and buy 1.0 unit of a digital asset in February 2026 for $3,000, then sell that unit in November 2026 for $4,200, paying a $20 transaction fee on the sale.

Because you bought this unit after January 1, 2026, and it never left the custodial account before you sold it, it is a covered security, and your broker owes you basis reporting on this lot. Net proceeds come to $4,200 minus the $20 fee, or $4,180; basis is the $3,000 you paid. That puts the gain at $4,180 minus $3,000, or $1,180. The holding period runs from mid-February to mid-November 2026 — about nine months, under a year — so this is a short-term gain.

On the 1099-DA, expect box 1g (cost or other basis) to show $3,000, box 2 checked (basis reported to the IRS), box 1f showing net proceeds around $4,180, and box 6 marked short-term. On Form 8949, this transaction goes in Part I under box G — short-term, basis reported to the IRS — with the $1,180 gain flowing through to Schedule D in the usual way.

A second worked example: a noncovered lot

Now take a coin you bought back in 2023, well before any of this reporting regime existed, and finally sell in 2026. Because you acquired it before January 1, 2026, it is noncovered no matter which account holds it or how the broker classifies its own custody arrangements — the acquisition date alone settles the question. Say you paid $1,000 for it in 2023 and sell it in 2026 for $1,600.

On this lot, expect box 9 checked (noncovered security), and box 1g (basis) may simply be blank — the broker is not required to fill it in, though some do so voluntarily. Either way, the responsibility to get the basis right falls on you: you supply the $1,000 figure yourself when you fill out Form 8949, using your own purchase records rather than relying on the form. The gain is $1,600 minus $1,000, or $600. Held from 2023 to 2026, this is well past the one-year mark, so it is long-term, landing in Part II under box K — long-term, basis not reported to the IRS — with the $600 gain carrying to Schedule D from there.

The habit that keeps both examples straight is the same one that works for stock: settle the acquisition date and custody chain first to answer covered versus noncovered, then let the holding period pick short versus long. Everything else is transcription.

Sources

• IRS, Form 1099-DA, 2026 revision: Form 1099-DA.
• IRS, Instructions for Form 1099-DA (2026): Instructions for Form 1099-DA.
• IRS, Instructions for Form 8949 (revision for returns filed for tax year 2025, the most current available): Instructions for Form 8949.
• IRS, Revenue Procedure 2024-28, wallet-by-wallet basis safe harbor: Rev. Proc. 2024-28.
• IRS, Notice 2024-56, transitional relief on digital asset reporting and backup withholding: Notice 2024-56.
• IRS, Notice 2025-33, extension and modification of that relief: Notice 2025-33.
• Federal Register, final rule removing the DeFi broker regulation following its Congressional Review Act disapproval, 90 FR 30825 (July 11, 2025).