Crypto Exchanges Struggle with IRS Reporting, Leaving Taxpayers in Limbo

The first crypto tax filing season under new broker reporting requirements is proving to be a challenge for taxpayers. The IRS now receives more data from exchanges, but this increased visibility doesn't automatically solve the problem of calculating gains and losses.

Under the upgraded Form 1099-DA rules applying to 2025 activity, brokers report gross proceeds from certain digital asset sales, but cost basis is generally not included. This leaves taxpayers to reconstruct their gains and losses from their own records.

A recent survey by Awaken Tax found that 21% of respondents were still waiting for information needed from an exchange or platform, while a further 20% said their 1099-DA was incomplete or uncertain.