The 1099-DA is the document the IRS will match your return against. Where it is right, filing is mechanical. Where it is wrong — and for anything you transferred between platforms, it is often wrong — the mismatch produces a CP2000 twelve to eighteen months after you file. This page is about closing that gap before it opens.
What the form contains
| Box | What is reported | What it means for you |
|---|---|---|
| Asset, dates, proceeds | The asset sold, date acquired (where known), date sold, gross proceeds | Proceeds are always there. The acquisition date appears only when the broker knows it. |
| Cost basis | Reported when required for covered securities; a broker may voluntarily report some noncovered information | Transferred-in assets are generally noncovered for broker basis reporting. “Not reported” does not mean your tax basis is zero. |
| Holding period | Short- or long-term indicator | Derived from the acquisition date. Wrong whenever that date is unknown. Check it against your own lots. |
One form arrives from each reporting broker. Selling on three reporting platforms can therefore mean multiple forms; reconcile all of them against your own records.
The three situations, in order of trouble
1. You acquired and sold while the same broker held the asset. For covered securities acquired after 2025 in a custodial account, basis reporting is generally required. Still reconcile the form to your own records rather than assuming every field is correct.
2. You transferred assets in, then sold. The broker generally treats transferred-in digital assets as noncovered for basis-reporting purposes. Under current Form 8949 instructions, if basis was not reported to the IRS you generally enter the correct basis in column (e); an adjustment is used when the reported basis itself is incorrect or another adjustment rule applies. Confirm the operative filing-year Form 8949 instructions before filing.
3. The acquiring platform no longer exists, or the trail runs through self-custody. Basis has to be reconstructed from exports, chain data and bank records. This is genuinely a service, not a spreadsheet exercise — and it only has to be done once, because the reconstructed record holds for every later year.
Lot method: decide before you sell, not after
The default is FIFO — first in, first out. Specific identification is allowed, but only if the lot is identified at or before the sale, in a way your records can show. Since basis moved to wallet-by-wallet tracking, the identification also has to be consistent with which wallet actually held the lot.
The practical consequence: the method is a planning decision. By the time the 1099-DA arrives, the sales are made and the methods are fixed. What remains fixable in filing season is the basis itself.
Reconcile before you file
- Match every 1099-DA line to a lot in your own records. The broker's line is a claim, not a fact.
- Follow the basis-status path shown by the form. If basis was not reported, current Form 8949 instructions generally have you enter the correct basis; if reported basis is wrong, use the filing-year adjustment mechanics. Do not invent an adjustment code merely because basis is absent.
- Where the holding-period indicator is wrong, correct it — a lot the broker first saw in March may have been yours since two Decembers ago, and long-term status follows your acquisition, if you can prove it.
- Keep the reconciliation as a single file. It is the one-page answer to a CP2000, prepared before the letter exists.
A transferred-in asset: proceeds reported, basis not reported
The reconciliation is not “replace the broker form.” It is: preserve what the broker actually reported, then apply the Form 8949 path for whether basis was reported and whether any reported figure is incorrect.
Use the indicator as a routing signal, not as tax advice
| 1099-DA indicator | Meaning in 2026 instructions | Reconciliation question |
|---|---|---|
| G | Short-term · basis reported to IRS | Does reported basis match your records? |
| H | Short-term · basis not reported | Can you document the correct basis and acquisition date? |
| J | Long-term · basis reported to IRS | Do basis and holding period match your records? |
| K | Long-term · basis not reported | Can you document basis and long-term status? |
| Y | Holding period unknown | Can your records establish whether the transaction belongs on the short- or long-term side? |
The filing-year Form 8949 controls the boxes and adjustment mechanics. HolderTax does not substitute a prior-year form layout for an unreleased operative revision.
Basis reporting is not the same for every 1099-DA
- Whether the asset is a covered or noncovered security for broker reporting.
- Whether it was acquired in the broker’s custodial account or transferred in.
- Whether basis was reported, not reported, or reported incorrectly.
- Whether your own records establish acquisition date, lot selection and holding period.
Do not file the broker's numbers "to be safe"
Filing figures you know are wrong, because they came on an official form, is the expensive kind of caution: the broker's higher gain becomes the number on record, and unwinding it later costs more than supplying the correct basis now. If the disagreement is large, spans years, or touches activity you never reported, read Amend, quiet disclosure, or voluntary disclosure before filing anything.
Primary authority checked 31 Aug 2026: IRS Instructions for Form 1099-DA (2026) and IRS Publication 1099 (2026). This page explains a form. It is not advice about your return, and reading it creates no professional relationship.