Why does my 1099-DA show no cost basis?
Because the rules did not require it yet, or the broker never had it. For sales in 2025, brokers only had to report gross proceeds on Form 1099-DA; mandatory basis reporting starts with covered assets acquired in the account on or after January 1, 2026, and anything transferred in from a wallet stays noncovered. The basis comes from your own records: reconstruct it from wallet history and report the row on Form 8949 with box H or K checked.
Key takeaways
- A proceeds-only 1099-DA is the designed 2025 outcome, not a broker error: gross proceeds reporting was mandatory, basis reporting was voluntary.
- Mandatory basis reporting covers only assets acquired in that broker account on or after January 1, 2026, and held there continuously; transferred-in assets stay noncovered indefinitely.
- A 1099-DA row without basis goes on Form 8949 with box H (short-term) or K (long-term) checked; your records supply what the form left blank.
- Reconstructing basis from wallet history is a classification job: every acquisition typed correctly, tracked wallet by wallet.
Why the basis box is empty
The 2025 tax year was the first year of Form 1099-DA: under the final broker regulations (T.D. 10000), custodial brokers report digital-asset sales effected on or after January 1, 2025, and the forms for those sales arrived in early 2026. For that first year the regulations made gross proceeds reporting mandatory and basis reporting voluntary, so most brokers reported proceeds only. A 1099-DA that shows what you sold for but not what you paid is the form working as the rules were written, and the gap between those two numbers is the part only your records can close.
Covered vs noncovered digital assets
Basis reporting becomes mandatory only for covered assets: units acquired in that broker's custody on or after January 1, 2026, and held there continuously until the sale. Everything else is noncovered: units acquired before 2026, and, permanently, units transferred into the broker from a wallet or another platform, because the broker never saw the acquisition and does not know what you paid. Those first covered-asset forms are the ones for tax year 2026, arriving in early 2027. Anyone who self-custodies and deposits to sell should expect proceeds-only rows as a standing feature, not a first-year quirk.
1099-DA vs Form 8949
The 1099-DA reports the sale; the gain or loss math happens on Form 8949. The 2025 revision of Form 8949 added digital-asset checkboxes: box G for short-term rows where the 1099-DA reported basis to the IRS, box H where the form was received but basis was not reported, and box I where no 1099-DA exists; boxes J, K, and L are the long-term counterparts. A proceeds-only 1099-DA row belongs in box H or K, with the proceeds from the form and the basis and acquisition date from your records. DeFi and self-custody disposals that generated no form at all belong in box I or L. The row must still appear either way: the reporting obligation attaches to the disposition, not to the paperwork.
Reconstructing basis from wallet history
Proceeds without basis means reconstruction, and reconstruction is classification. Each lot's basis is set by what its acquisition actually was: a purchase sets basis at cost, a staking reward or airdrop sets basis at the fair market value recognized as income, a transfer-in carries basis over from the sending wallet unchanged, and a swap closes one lot and opens the next at execution value. Type one hop wrong -- a self-transfer read as income, a swap read as a deposit -- and every later number inherits the error. Since January 1, 2025, basis must also be tracked wallet by wallet rather than pooled across accounts (Rev. Proc. 2024-28 supplied the transition allocation), so the reconstruction has to respect which wallet held which lot. This is the work the classification engine does on raw hashes: it types each transaction, names counterparties on plain transfers, and routes to review the rows the evidence does not settle, instead of guessing a basis chain into existence.
Specific identification and the FIFO default
When particular units are not identified, the broker rules default the ordering to first-in, first-out within the account. Notice 2025-7 granted temporary relief on the mechanics -- taxpayers can make an adequate identification in their own books and records rather than instructing the broker at the moment of sale -- and Notice 2026-20 extended that relief through December 31, 2026. The relief only helps if the books actually exist: a reconstructed, per-wallet lot history is what makes an identification adequate.
Disputed or incorrect 1099-DA
A form can be wrong: proceeds that double-count, a basis figure for units the broker mispriced, or rows that belong to a different taxpayer after a transfer. The form does not change what actually happened. Report the correct figures from your records, use the Form 8949 adjustment columns to reconcile a form that is wrong rather than silently adopting it, and ask the broker for a corrected 1099-DA. Keep the reconstruction evidence. A documented difference between the form and the return is answerable; an unexplained mismatch, or a missing row, is the version that invites questions.
Frequently asked questions
How do I report a 1099-DA with no cost basis on my tax return?
On Form 8949, with box H checked for short-term rows or box K for long-term: a 1099-DA was received, but basis was not reported to the IRS. The proceeds come from the form; the basis and acquisition date come from your records. The IRS receives the same form, so the row needs to appear on the return; your records supply what the form left blank.
Why would cost basis not be reported to the IRS?
Three common reasons. The sale happened in 2025, when only gross proceeds were required on Form 1099-DA. The asset was transferred into the broker, making it noncovered: the broker never saw the acquisition. Or the asset was acquired before January 1, 2026, ahead of mandatory basis reporting. Brokers may report basis voluntarily, but most forms carry proceeds only.
What are the new IRS rules for crypto reporting?
Since January 1, 2025: custodial brokers report gross proceeds on Form 1099-DA, with basis reporting phasing in for covered assets acquired on or after January 1, 2026. Basis must be tracked wallet by wallet rather than universally, with Rev. Proc. 2024-28 supplying the transition. The separate DeFi broker rule was repealed in April 2025, so self-custody activity generates no form. And under Notice 2024-57, brokers do not currently report wrapping, liquidity, staking, lending, short-sale, or notional-principal-contract transactions, which remain taxable all the same.
Do I still owe tax if my 1099-DA is wrong or missing?
Yes. The obligation attaches to the disposition, not the paperwork: gain or loss on a sale is reportable whether the form arrived correct, wrong, or not at all. A wrong form is reconciled with the adjustment columns and a corrected-form request; a missing form just means your records carry the whole row.
Can my broker add the basis for coins I transferred in?
Transferred-in assets are noncovered: the broker is not required to report basis for them, and usually cannot, because the acquisition happened outside its custody. Some brokers accept documentation or report voluntarily, but the acquisition evidence lives in your wallet history either way, which is why the reconstruction runs on the on-chain record.
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This is informational only, not tax advice; verify with a qualified tax professional before filing.