1099-DA Reconciliation Tool

Form 1099-DA, Digital Asset Proceeds From Broker Transactions, is the IRS information return custodial brokers use to report your crypto sales and exchanges. It works much like the 1099-B a stock brokerage sends, but for digital assets - and crucially, the IRS gets a copy too. That means the proceeds figure on that form will be matched against what appears on your return.

The reporting phase-in

Under the final regulations, brokers report gross proceeds for transactions on or after January 1, 2025, with the first forms arriving in early 2026. Basis reporting is phased in for certain transactions from January 1, 2026, applying to "covered" assets - broadly, those acquired and held within the same broker account. Anything acquired earlier, or transferred in from another wallet, is generally noncovered, and brokers aren't required to report basis for it.

The practical consequence is blunt: for the 2025 tax year, most forms show proceeds with an empty basis box. The IRS is explicit that you must calculate basis yourself before filing.

Where mismatches come from

Differences aren't necessarily errors. Gross proceeds may be reported before fees you deducted. Transfers between your own wallets aren't sales but can look like disposals if records are thin. Foreign and decentralized platforms generally don't issue the form at all - yet those transactions are still reportable. And the same trade can appear under different names in different broker systems.

Reconciling before you file means you can explain every difference, rather than discovering it in a matching notice a year later.

1. Enter one row per disposal line. Date, asset, broker, quantity, the proceeds shown on the form (Box 1f), and the proceeds in your own records.
2. Add basis on both sides. Whatever the broker reported in Box 1g - often blank - and the basis you can actually support from your records. Leave blank where there is none.
3. Mark covered or noncovered. Box 9 tells you which; noncovered rows are the ones where you're expected to supply basis yourself.
4. Set a tolerance and review. Small differences from fee netting are normal - set a dollar tolerance and the tool flags only what's outside it.

Each row gets a status: matched, a proceeds difference, or missing basis. The summary board totals both sides, shows how much basis you can currently support, estimates the gain you'd report today, and - most importantly - tells you how much in proceeds is at risk of being taxed as if it had zero cost. Export the whole reconciliation as CSV for your accountant.