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News

IRS Crypto Tax Draft Form Released to Aid Reporting of Digital Asset Transactions

August 10, 2024 - Around 2 mins mins to read

Key Points:

  • The IRS updated the draft Form 1099-DA for reporting digital asset transactions starting in 2026, simplifying reporting requirements.
  • The IRS crypto tax draft form eliminates the need to report transaction times, wallet addresses, and broker types.
  • The tax service invites feedback on the draft within 30 days and will release further regulations for decentralized brokers later this year.
The Internal Revenue Service has floated another draft of Form 1099-DA, which, at least preliminarily, it would like taxpayers to use when reporting digital asset transactions beginning in tax year 2026.
IRS Crypto Tax Draft Form Released to Aid Reporting of Digital Asset Transactions

Read more: Kraken Is Requested By The IRS For Customer Information From $20,000

IRS Crypto Tax Form 1099-DA for Digital Asset Reporting by IRS

The proposed IRS crypto tax form floated on August 8 changed drastically from its April predecessor to help improve reporting digital asset transactions.

The new Form 1099-DA, “Digital Asset Proceeds From Broker Transactions,” would make crypto reporting easier on both the taxpayer and the filer. This revised draft would eliminate burdensome requirements on the part of the filer to disclose specified transaction times, wallet addresses, and transaction IDs—all of which were at least concerning from a privacy perspective in the prior draft.

U.S. taxpayers will report cryptocurrency transactions—mostly tied to centralized exchanges, including Coinbase and Kraken—conducted through brokers from the start of 2025, due by April 2026.

These latest adjustments heed criticisms from the crypto industry that this draft was overly complex and intrusive on the question of privacy. Crypto lawyer Drew Hinkes highlighted that the renewed IRS crypto tax form had been improved “massively” by reducing data reporting.

Revised Form Seeks Public Feedback

Further guidance on decentralized and noncustodial brokers will be issued by the IRS at a later date in 2022. In response to the digital currency sector’s thundershower of criticism and agitation, it has opened such a current draft to the public for comments in the following 30 days.

The IRS crypto tax comes shortly after finalized crypto broker reporting regulations from the IRS in June exempted decentralized exchanges and self-custody wallets from new reporting requirements.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

1099-DA

Crypto Tax

IRS

IRS Crypto Tax

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Author

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.
News

IRS Crypto Tax Draft Form Released to Aid Reporting of Digital Asset Transactions

Key Points:

  • The IRS updated the draft Form 1099-DA for reporting digital asset transactions starting in 2026, simplifying reporting requirements.
  • The IRS crypto tax draft form eliminates the need to report transaction times, wallet addresses, and broker types.
  • The tax service invites feedback on the draft within 30 days and will release further regulations for decentralized brokers later this year.
The Internal Revenue Service has floated another draft of Form 1099-DA, which, at least preliminarily, it would like taxpayers to use when reporting digital asset transactions beginning in tax year 2026.
IRS Crypto Tax Draft Form Released to Aid Reporting of Digital Asset Transactions

Read more: Kraken Is Requested By The IRS For Customer Information From $20,000

IRS Crypto Tax Form 1099-DA for Digital Asset Reporting by IRS

The proposed IRS crypto tax form floated on August 8 changed drastically from its April predecessor to help improve reporting digital asset transactions.

The new Form 1099-DA, “Digital Asset Proceeds From Broker Transactions,” would make crypto reporting easier on both the taxpayer and the filer. This revised draft would eliminate burdensome requirements on the part of the filer to disclose specified transaction times, wallet addresses, and transaction IDs—all of which were at least concerning from a privacy perspective in the prior draft.

U.S. taxpayers will report cryptocurrency transactions—mostly tied to centralized exchanges, including Coinbase and Kraken—conducted through brokers from the start of 2025, due by April 2026.

These latest adjustments heed criticisms from the crypto industry that this draft was overly complex and intrusive on the question of privacy. Crypto lawyer Drew Hinkes highlighted that the renewed IRS crypto tax form had been improved “massively” by reducing data reporting.

Revised Form Seeks Public Feedback

Further guidance on decentralized and noncustodial brokers will be issued by the IRS at a later date in 2022. In response to the digital currency sector’s thundershower of criticism and agitation, it has opened such a current draft to the public for comments in the following 30 days.

The IRS crypto tax comes shortly after finalized crypto broker reporting regulations from the IRS in June exempted decentralized exchanges and self-custody wallets from new reporting requirements.

DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.