What should a preparer do when a client gets a corrected Form 1099-DA?
Keep the original. Put the corrected form next to it and next to what was actually filed, then compare row by row: account, date, asset, quantity, and the money boxes. For every row that changed, write down why it changed (a sale reclassified as a transfer to the client's own wallet, basis now supplied, a duplicate removed, a holding period changed) and which workpapers you updated. That revision trail lets another reviewer follow the file later. If the return is not filed yet, the IRS tells recipients to report from the corrected form as they normally would. If the return is already filed, the IRS points to Form 1040-X when there is an error to correct; whether this particular correction calls for an amendment is the preparer's call. CryptoTaxEdge classifies the hashes behind the changed rows. It does not compute basis, prepare or amend returns, or decide whether to amend.
Key takeaways
- A corrected Form 1099-DA usually has the CORRECTED box checked. Keep both versions and match them by filer, recipient, and account number (if any).
- Compare three columns, not two: original form, corrected form, and the return as filed. A row can change on the form without changing the return.
- Record a reason and the evidence for every changed row. For rows that turn on what happened on-chain, a hash-level classification record is that evidence.
- Before filing, the IRS tells recipients to report from the corrected form, unless it conflicts with the firm's records (see below). After filing, amending is the preparer's judgment with the client. We do not make it.
What the IRS says about corrected forms
The broker side. The 2026 Instructions for Form 1099-DA do not carry their own corrections section. Under Reminders, they tell brokers to "also use the current Pub. 1099," and list "Corrected and void returns" among its topics. The 2025 instructions carry the same pointer. Pub. 1099, General Instructions for Certain Information Returns (2026), Part H, then sets the mechanics a preparer will see on the client's copy. Part H describes paper corrections; e-filed corrections follow Part F, but the recipient copy still shows the CORRECTED box.
- "Enter an 'X' in the 'CORRECTED' checkbox only when correcting a form previously filed with the IRS or furnished to the recipient."
- "You may enter a date next to the 'CORRECTED' checkbox. This will help the recipient in the case of multiple corrections."
- "If the account number was provided on the original return, the same account number must be included on both the original and corrected returns to properly identify and process the correction. If the account number was not provided on the original return, do not include it on the corrected return."
- Pub. 1099 says that "in some cases, you must enter 0 (zero) to make corrections" (Part G). Error Type 1 covers "A return was filed when one should not have been filed," and Error Type 2 has the filer enter "-0- (zero) for all money amounts" on the return being backed out. A corrected row of zeros can therefore be the broker backing out a row.
The recipient side. Understanding your Form 1099-DA says, for a form with incorrect information: "Request a corrected form from the issuer," "Keep a copy of the corrected Form 1099-DA with your records, along with any correspondence you have with the issuer," "Don't contact the IRS. We can't correct your Form 1099-DA," "Don't wait to file your taxes," and "Report income from the corrected Form 1099-DA on the appropriate tax return or schedule as you normally would." For a form that should not have been sent at all, it adds: "Keep a copy of the original form and all correspondence with the issuer for your records."
Form 8949. The Form 8949 instructions cover columns (f) and (g) for a form that "is incorrect," including code B for wrong basis in box 1g. Row mechanics live on How do I report Form 1099-DA on Form 8949 and Schedule D?.
Already filed. The Instructions for Form 1040-X say: "If you discover an error after filing your return, you may need to amend your return. Use Form 1040-X to correct a previously filed Form 1040, 1040-SR, or 1040-NR." They also say: "File Form 1040-X only after you have filed your original return." The IRS page File an amended return says to "File an amended return if there's a change in your: Filing status, Income, Deductions, Credits, Dependents, Tax liability." For timing, see When To File in those instructions.
The row-by-row comparison
Work in reconciliation order: entity and account, then date, asset, and quantity, then money boxes. Keep unexplained differences visible.
- Pair the forms. Same filer and recipient. If the original carried an account number, the corrected form must carry the same one. If the original had none, the corrected form should not have one either (Pub. 1099, Part H). A mismatch, or a number on only one version, is a question for the issuer.
- Pair the rows. Match on date sold (box 1e), asset (boxes 1a and 1b), and units (box 1c). Note rows that appear on only one version.
- Diff the boxes. Proceeds (1f), basis (1g), basis reported (2), term (6), customer-provided acquisition information (8), noncovered (9), transfer-in (12a, 12b).
- Compare to the return as filed. Did the firm already exclude the row, use the correct basis, or report it on the correct Part?
- Write the reason and the evidence. One line per row, naming the workpaper that changed.
Why rows usually change:
| Change on the corrected form | Typical reason | Evidence that explains it |
|---|---|---|
| Row removed, or money amounts -0- | Broker treated a withdrawal as a sale; the client moved assets to its own wallet | Classification of the outbound hash, plus the firm's ownership confirmation |
| Box 1g now filled, box 2 changed | Basis now supplied by the broker | Firm's lot records; classification of the acquisition hash |
| Duplicate row gone | Same account, date, asset, and units reported twice | The two original rows side by side |
| Box 6 term changed | Holding period corrected | Acquisition date from records or the acquisition hash |
| Box 12a or 12b added | Units now identified as transferred in | Classification of the inbound deposit hash |
Why rows disagree in the first place: Why don't my 1099-DAs match my crypto tax software?. A basis box that went from blank to a number: Is blank cost basis on Form 1099-DA the same as zero?. A filed return that no longer matches the form: What happens if my crypto return doesn't match my 1099-DA?.
Where it is genuinely unsettled
A correction that changes the form but not the numbers. Suppose the firm already excluded a wallet withdrawal the broker had reported as a sale, and the corrected form now removes that row. The filed return's gain does not change. Practitioners take two positions:
- No amendment needed. The IRS amended-return page ties amending to a change in filing status, income, deductions, credits, dependents, or tax liability. If none moved, the firm documents the correction and keeps it with the return.
- Amend for consistency. The filed Form 8949 presentation (box, code, or explanation) was built around the original form. Some firms want the return to tie to the information return now on file.
None of the IRS sources we fetched on October 20, 2026 addresses this specific case. It is the preparer's call, and we do not take a side.
A corrected number that conflicts with the firm's records. If the corrected box 1g still disagrees with the firm's lot records, the Form 8949 instructions supply the adjustment mechanics. Which number is right is a basis question. We do not compute basis.
Worked example
A client filed a 2025 return on extension. In late 2026 the broker furnishes a corrected 2025 Form 1099-DA, CORRECTED box checked and dated, same account number. The firm keeps the original in the file, unaltered.
Row 1: 1.50000000 ETH, proceeds $4,800. Original: box 1g blank. Corrected: box 1g $3,400. As filed: basis $3,100 from the firm's records. Reason: basis now supplied by the broker, and it differs from records. The acquisition hash serves as swap, tying the lot to a dated on-chain acquisition. The basis figure is the firm's computation; the $300 gap goes to the reviewer and, if unresolved, back to the issuer.
Row 2: 0.20000000 BTC, proceeds $19,000. Original: a sale. Corrected: money amounts -0-. As filed: excluded as not a disposition. Reason: sale reclassified by the broker as a transfer to the client's own wallet. The outbound hash serves as category transfer with needs_review: true and taxable: null, because the destination is not verified on-chain as the client's own wallet (Standard GAP-1). The firm's confirmation that the address is the client's hardware wallet sits in the workpapers.
Row 3: 40 SOL. Original: two identical rows, same account, date, asset, and units. Corrected: one row. As filed: one row. Reason: duplicate removed. No hash is needed; the evidence is the two original rows.
Row 4: 2.00000000 ETH. Original: box 6 short-term. Corrected: long-term. As filed: Part II, long-term, from records. Reason: holding period corrected. The acquisition hash is the dated event behind the firm's term determination.
Rows 2, 3, and 4 change the form but not the filed numbers. Row 1 is a basis disagreement. Whether any of this calls for Form 1040-X is the preparer's decision; the revision trail shows a later reviewer why each row moved.
This example is illustrative, not advice.
How CryptoTaxEdge fits
Classification is a hash in, a record out. POST https://app.cryptotaxedge.com/v1/classify with { "chain", "hash" }. One category, one treatment from the closed enum (disposal, income, non_taxable, expense, needs_review), confidence 0 to 100 as a routing signal, needs_review: true and taxable: null when a treatment cannot be honestly asserted. Confidence is not an accuracy percentage.
On a corrected form, that record is the "why" column for rows that turn on what happened on-chain: the withdrawal behind a removed sale, the deposit behind a new box 12a, the acquisition behind a basis or term change. A one-way transfer whose counterparty is not verified as the client's own wallet serves as category transfer with needs_review and taxable: null (Standard GAP-1); verified self-transfers serve non_taxable. See What does needs_review mean?.
What CryptoTaxEdge does not do on this page
- We do not compute basis, holding period, gain, or loss.
- We do not prepare or amend returns, and we do not decide whether a corrected form calls for Form 1040-X.
- We do not contact issuers, request corrected forms, or judge whether the broker's correction is right.
- We do not choose Form 8949 boxes, codes, or adjustment amounts.
- We do not connect to wallets or take custody. Hash in; category, treatment, confidence, and review flag out.
Classify a transaction at https://cryptotaxedge.com/explorer?src=answers (ten a day, no signup).
Frequently asked questions
Should I throw away the original Form 1099-DA once the corrected one arrives?
No. The comparison only works with the original in the file, and the IRS tells recipients to keep issuer correspondence with the forms. Corrections come from the issuer, not the IRS.
How do I tell a corrected form from a second, separate form?
Look for the CORRECTED checkbox and, if the broker used one, the date next to it, then match filer, recipient, and account number (if any). Some errors (a wrong TIN or name, or the wrong type of form) take two returns: a CORRECTED form zeroing out the original and a new form, not marked CORRECTED, carrying the right information (Pub. 1099, Error Type 2). A zeroed corrected form that arrives with a new uncorrected one usually means a replacement, not an extra sale. Confirm with the issuer.
The corrected form arrived after I filed. Do I have to amend?
That is the preparer's call. The Form 1040-X instructions say you "may need to amend" when you discover an error after filing. Compare the corrected form to the return as filed first; some corrections change the form without changing the return.
Accounting firm with crypto clients? See the Firm plan.
This is informational only, not tax advice; verify with a qualified tax professional.