{"id":2368,"date":"2024-04-26T07:59:06","date_gmt":"2024-04-26T07:59:06","guid":{"rendered":"https:\/\/www.tax1099.com\/blog\/?p=2368"},"modified":"2025-11-13T11:41:58","modified_gmt":"2025-11-13T11:41:58","slug":"new-form-1099-da-for-digital-assest-reporting","status":"publish","type":"post","link":"https:\/\/www.tax1099.com\/blog\/new-form-1099-da-for-digital-assest-reporting\/","title":{"rendered":"IRS Released New Form 1099-DA Draft for Digital Asset Reporting\u00a0"},"content":{"rendered":"

A new Form 1099-DA draft has been released by the Internal Revenue Service (IRS) that reinforces the requirements for digital assets reporting. The form, titled “Digital Asset Proceeds from Broker Transactions,” will be\u00a0active in 2025.<\/p>\n

Overview:<\/h2>\n

The IRS published a draft<\/a> of proposed regulations in August\u00a02023, which presaged much-needed information about brokers’ potential future information reporting obligations. Even though the idea of an IRS Form 1099-DA for NFTs, cryptocurrencies, and other digital assets was first announced back in 2021, not much information was available until now.<\/p>\n

A preview of the new Form 1099-DA was made available by the IRS on April 19th. And could be used by the cryptocurrency brokers from January 1, 2025<\/strong>.<\/p>\n

What is Form 1099-DA?<\/h2>\n

To perceived gaps in tax collections, Congress added a tax information reporting requirements for digital assets within the infrastructure Investment and Jobs Act. Following this law, the IRS has introduced a draft, Form 1099-DA<\/a> as a means to implement this portion of the bill. Last autumn, the\u00a0Treasury and the IRS released an initial draft of the\u00a0proposed regulations defining the requirements. Although those regulations have not yet been finalized, the publication of the draft Form 1099-DA signifies the rules’ practical implementation, outlining the data that must be reported and how it must be organized.<\/p>\n

Third Party Reporting on Digital Assets<\/h2>\n

The introduction of a requirement for Brokers and other intermediaries to provide third party reporting of activity was a way to attempt to ensure proper tax collection on income generated through the trading of various digital assets such as cryptocurrency, stakes, and NFTs.<\/p>\n

The new form 1099-DA is intended to address the difficulty that the IRS has tracking income from new investment vehicles outside traditional financial channels.\u00a0And the IRS aims to increase the accessibility of cryptocurrency tax information and\u00a0make sure that all bitcoin traders are disclosing their gains and losses.<\/p>\n

\"New<\/figure>\n

New Draft for Form 1099-DA<\/h2>\n

The draft form released by IRS proposes the collection of detailed information such as the type of digital asset,\u00a0amount involved\u00a0and transaction\u00a0identifiers that currently does not exist and are unclear at this time.
\nUnlike\u00a0its\u00a0predecessors, such as\u00a0Form 1099-B<\/a>, the new form includes specific\u00a0additions targeted specifically at these new assets:<\/p>\n