#U.S. Cryptocurrency Transactions Included in IRS Tax Returns#
Hot Topic Overview
Overview
The Internal Revenue Service (IRS) has announced that a third-party reporting regime for cryptocurrency transactions will be implemented starting in 2025. Centralized exchanges such as Coinbase and Gemini will be required for the first time to report users' cryptocurrency transaction information to the tax agency via the newly established 1099-DA form. The regime requires custodial trading platforms, digital asset wallet providers, cryptocurrency ATM operators, and digital asset payment processors to track and record users' buy and sell transactions throughout the year and submit reports to users and the IRS at the beginning of 2026. The specific implementation timeline shows that cryptocurrency asset cost basis (purchase price) information reporting will begin in 2026; point-to-point transaction reporting for decentralized platforms (such as Uniswap and Sushiswap) will be delayed until 2027, but only total transaction amounts will need to be reported. Newly listed Bitcoin spot ETFs will also be reported using the 1099-B or 1099-DA forms, including share trading and taxable events occurring within the fund. The regime aims to improve tax compliance and reduce misreporting and underreporting.
Ace Hot Topic Analysis
Analysis
The Internal Revenue Service (IRS) has announced that it will implement a third-party reporting system for cryptocurrency transactions starting in 2025. This means that centralized exchanges like Coinbase and Gemini will be required for the first time to report users' cryptocurrency transaction information to the tax agency through a newly established 1099-DA form. The system requires custodial exchanges, digital asset wallet providers, cryptocurrency ATM operators, and digital asset payment processors to track and record users' buy and sell transactions throughout the year and submit reports to both users and the IRS in early 2026. The implementation timeline shows that reporting of cryptocurrency asset cost basis (purchase price) information will begin in 2026. Reporting of peer-to-peer transactions on decentralized platforms (such as Uniswap, Sushiswap) will be delayed until 2027, but will only require reporting of total transaction amounts. New bitcoin spot ETFs will also be reported via 1099-B or 1099-DA forms, including share transactions and taxable events generated within the fund. While the new rules do not introduce new taxes, they are designed to improve tax compliance, reduce misreporting and underreporting, remind taxpayers of their tax obligations on crypto transactions, and streamline the reporting process.
Public Sentiment · Discussion Word Cloud
Public Sentiment
Discussion Word Cloud
Classic Views
The Internal Revenue Service (IRS) will implement a third-party reporting regime for cryptocurrency transactions on centralized platforms (such as Coinbase, Gemini) starting in 2025.
Trading platforms will report users' cryptocurrency transaction information to the tax authorities through a new 1099-DA form, including total transaction amount and cost basis.
The regime aims to improve tax compliance, reduce misreporting and underreporting, and remind taxpayers of their tax obligations for cryptocurrency transactions.
Reporting for peer-to-peer transactions on decentralized platforms (such as Uniswap) will begin in 2027, but only requires reporting of total transaction amount, not including cost basis information.