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Your broker reports what you sold for on your 1099-DA. For 2025 sales, basis was optional, so the form may not show what you paid. File that gap as it stands and the IRS taxes the whole sale as gain.
Call (866) 681-2140 to start with your exchange exports.
We rebuild cost basis wallet by wallet, which is how the IRS now requires basis to be tracked
We handle closed and frozen exchanges, including accounts you can no longer log into
We reconcile DeFi disposals on Form 8949, and report staking, mining and airdrops as income where required
A cryptocurrency tax accountant reconciles first, then prepares the return. Cryptocurrency tax services here cover five parts of that work:
The reconstruction. We pull each wallet, exchange and chain into one ledger, with a defensible cost basis on each disposal.
The return. Form 8949 and Schedule D for disposals, Schedule 1 or Schedule C for mining, staking and airdrop income, plus the state return.
The foreign side. Form 8938 and the FBAR, each assessed for each offshore exchange account.
The prior years. We amend earlier returns filed with basis that was wrong or missing.
The notice. If the IRS has already sent a CP2000 or a letter about digital assets, our IRS audit representation team answers it.
If your records are already clean in Koinly or CoinTracker, say so and we price the return alone.
Gross proceeds for 2025 sales. Cost basis only from 2026 sales, and only for covered assets.
Covered means acquired after 2025 in that broker’s custodial account and held there until the sale. Anything acquired earlier, or transferred in, is noncovered, and you supply the basis.
Assets acquired before 2026 are noncovered, so for a 2025 return the IRS receives a proceeds figure it can match and may receive no basis. Leave the basis blank and the IRS treats the sale as pure gain.
The IRS sends a notice when the 1099-DA crypto proceeds and your return do not match.
What your 1099-DA reports, and when
Brokers report basis a year after they start reporting proceeds.
An exchange keeps your basis while the coins stay there. Once you move the coins to a wallet or another exchange, the new platform has no record of what you paid.
Where the cost basis goes missing
You can lose the basis record at each move.
Basis recorded
Exchange A stops tracking it
No broker involved
Exchange B has no record of what you paid
On a $60,000 sale that is a $60,000 taxable gain on money you already spent buying the coin.
The IRS now requires basis tracked wallet by wallet.
We rebuild it from the acquisition forward. We work from raw exports, wallet addresses and on-chain history, then apply one lot identification method throughout, so the IRS can trace each figure.
The IRS ended pooled basis across wallets on January 1, 2025, and now requires basis tracked wallet by wallet. The IRS closed the one-time safe harbor for allocating what you already held on the earlier of your first 2025 disposal or the due date of your 2025 return, including extensions. If you extended and have not yet sold, ask us before you file.
Through 2025, holders with custodial accounts could identify which units they were selling in their own books. From 2026 you generally make that identification with the broker, at or before the sale, or the default ordering applies instead.
Form 8949 crypto disposals are only as good as the ledger behind them, so a cryptocurrency tax accountant starts with the ledger.
FTX, Celsius, Voyager and BlockFi closed with their transaction histories.
Our forensic team reconstructs the record from bank transfers in and out, the statements you still have, on-chain movement and any partial exports. We then document the method so we can show the IRS how each figure was built.
The same applies to a wallet you no longer control, an exchange that froze withdrawals, and accounts opened years ago on a platform that has since been acquired twice. A cryptocurrency tax accountant here takes that work.
High volume alone does not qualify you for trader tax status. The IRS asks whether your securities trading is substantial, continuous and regular, and it generally treats spot crypto as property, which is not a security.
Qualifying traders in securities or commodities can elect Section 475(f), and crypto positions are not automatically included. Where it applies, you report ordinary gains and losses on Form 4797, with no $3,000 capital loss cap and no wash sale rule.
The election is due by the unextended due date of the prior year’s return, so you decide a year ahead, and the first year generally needs Form 3115 to change accounting method. We model whether it fits before that date.
The wash sale rule in IRC 1091 applies to stock and securities. The IRS generally treats digital assets as property, so the rule has not applied to them.
A spot crypto ETF is a security, so Section 1091 applies to it in full. If you hold an ETF alongside the coin, two rules apply in one portfolio.
Congress has proposed closing the gap more than once. A House bill introduced in 2026 would apply to dispositions after its introduction, and it is not current law. We recheck the position each filing season.
Keep the trade records either way. If the law changes going forward, the IRS can still examine earlier years.
Two separate filings can apply, and neither is a tax.
FBAR, FinCEN Form 114. An account holding only virtual currency is not currently reportable. An account holding other reportable assets may be, where foreign accounts exceed $10,000 combined.
Form 8938 under FATCA, which may apply where the exchange account is a specified foreign financial asset and its own threshold is crossed.
The two definitions differ, so we assess each offshore exchange account separately and document the position. Where prior years were missed, the IRS Streamlined Filing Compliance Procedures may be open.
Buying and holding is not. Selling, swapping and spending are disposals. Receiving crypto can be income instead.
Taxable. Selling for dollars, swapping one coin for another, spending crypto on goods or services, and receiving it as payment, mining, staking or an airdrop.
Not taxable. Buying with dollars and holding, moving coins between your own wallets, and gifting within the annual exclusion.
The IRS sets the rate by holding period: ordinary rates on a coin held under a year, lower long term capital gains rates on one held over a year. Income from mining, staking and airdrops is ordinary either way, valued when you received it.
Form 1040 also carries a digital asset question on page one. You answer it whether or not you sold anything, and a wrong answer is its own problem, separate from the numbers.
Reconciliation is priced separately from the return, because they are different jobs and only one of them scales with your trading.
What moves the number: how many wallets and exchanges are in play, whether a clean aggregator report already exists, how much DeFi and on-chain activity has to be traced, and whether any of the platforms involved have closed. Prior year amendments are quoted per year, because a cryptocurrency tax accountant reworking an old return is doing the reconciliation again from the start.
You get the number in writing before anything starts, and nothing is billed that was not quoted first.
Professional and quick! They handled options, cryptocurrencies, and personal investments well, which were my pressing needs for an accountant. They also answered my questions and offered extra time for longer conversations.
Our team includes CPAs and Enrolled Agents who work on individual returns, business taxes and tax planning. Tell us what you need help with when you get in touch.
You do not need clean records to start. Send whatever you have, including the partial exports and the exchanges that no longer answer.
We will tell you what is missing, what it takes to rebuild, and what the cryptocurrency tax services it needs would cost. In writing, before anything begins.
General information, not advice for your circumstances. Digital asset rules change year to year, so speak to a CPA about your own facts before acting on it.
