Digital Assets in 2026: Updating Organizers for Form 1099-DA and Basis Tracking

Digital assets are about to become far less “optional” in your tax workflow. For the 2026 filing season (tax year 2025 returns), many clients will see a new document entering their tax packet: Form 1099-DA, Digital Asset Proceeds From Broker Transactions. The IRS has been clear that broker reporting on Form 1099-DA begins for transactions on or after January 1, 2025, with additional reporting elements coming later. You can review the IRS overview here: About Form 1099-DA.

For CPA and accounting firms, the biggest impact is not the form itself. It’s what changes upstream: intake questions, organizer design, basis documentation, and review-ready workpapers. If your organizer still treats crypto as a yes/no checkbox with no supporting workflow, you will feel it in rework, late clarifications, and reviewer bottlenecks.

Why Form 1099-DA changes the organizer, not just the return

Historically, digital asset reporting was uneven. Clients might bring 1099-B equivalents from exchanges, CSV exports, screenshots, or nothing at all. Firms often relied on a mix of client statements and third-party calculators, then documented positions in a variety of ways.

With the IRS final regulations, broker reporting becomes more consistent over time, but it also creates a new reality: clients will assume the 1099-DA “covers it,” even when it does not include everything you need to prepare an accurate return.

The IRS guidance also signals that reporting requirements roll out over time. The IRS fact sheet on the final regulations notes that brokers must report gross proceeds for transactions on or after January 1, 2025, and that basis reporting applies to certain transactions on or after January 1, 2026. That matters because your 2026 intake and your 2027 intake are not the same problem.

So your organizer needs to do two jobs:

• capture what 1099-DA provides, and what it does not
• collect the missing details in a consistent, reviewer-friendly format

The first-year pain point: gross proceeds arrives before reliable basis

For tax year 2025 reporting, the IRS instructions indicate brokers are not required to report basis information for sales effected in 2025. That means many clients will receive proceeds data but not the cost basis you need to compute gains accurately. You can see this directly in the IRS 2025 instructions for Form 1099-DA: Instructions for Form 1099-DA (2025).

This is where firms can either win or suffer:

• If the organizer asks only for the 1099-DA, you will end up chasing basis late.
• If the organizer asks for the basis method and supporting records up front, your prep and review lanes stay clean.

Clients also tend to have multiple “places” where basis lives: centralized exchanges, self-custody wallets, transfers between platforms, and conversions that complicate lots. Without a structured intake, you end up reconciling after the fact, exactly when you can least afford it.

What to add to your organizer so digital assets stop becoming a fire drill

Instead of treating digital assets as a single question, give it a dedicated mini-section with clear outputs. The goal is to create a “digital asset data pack” that your preparer can work from without a long email thread.

Here are the organizer elements that reduce rework dramatically:

A simple inventory of accounts and wallets

Ask clients to list:

• exchange or broker name (Coinbase, Kraken, Gemini, etc.)
• hosted wallet providers used
• any self-custody wallets (hardware wallet, MetaMask, etc.)
• whether assets were transferred between platforms during the year

This sounds basic, but it prevents the most common miss: the client supplies one 1099-DA and forgets another platform entirely.

A document request that is specific, not vague

Ask for:

• all Forms 1099-DA received
• year-end transaction report (CSV if available) for each platform used
• deposit and withdrawal history if there were transfers between platforms
• documentation for assets received as compensation, rewards, or other non-purchase events

You can also point clients to the IRS explanation of what Form 1099-DA is intended to report. It helps reduce “why do you need this” pushback.

Basis collection that matches how clients actually acquired assets

Have checkboxes for acquisition types, because the required support differs:

• bought with fiat on an exchange
• received from another wallet or person
• earned through work or services
• received through rewards, staking, or similar activity
• received through an airdrop, fork, or promotional credit
• swapped one digital asset for another
• used digital assets to buy goods or services

If the client checks anything beyond “bought and sold,” trigger a follow-up request for the supporting transaction history.

A clear instruction on fees and lot identification

Ask clients to confirm:

• whether transaction fees are included in their exports
• whether they used specific identification, FIFO, or another method in their own tracking tool
• whether they changed platforms or tracking tools during the year

Consistency is what protects review time. You do not want one client using FIFO and another using random lot picks without documentation.

A reviewer-ready workpaper package for 1099-DA clients

The biggest operational upgrade you can make is standardizing the digital asset workpaper output. When this is consistent, senior reviewers can validate instead of reconstruct.

A strong digital asset workpaper package typically includes:

• a one-page “digital asset summary” (accounts used, activity types, method used)
• reconciliation of Forms 1099-DA to the transaction summary (what’s included, what’s excluded)
• proceeds and basis rollups by platform, with clear totals
• a variance note when 1099-DA proceeds do not match the computed disposition totals
• an exceptions list (missing basis, missing lots, missing platform history)

This is especially important because the IRS notes there is transitional relief and special handling for certain transaction types while guidance evolves. Having a standardized exceptions list prevents confusion inside the file. The IRS fact sheet summarizes transition guidance and transaction types that have special timing considerations in the rollout: Final regulations and related IRS guidance for digital asset broker reporting.

Setting client expectations without scaring them

Clients often assume digital assets are either “anonymous” or “fully handled by the exchange.” The right message is calm and operational:

• You may receive a new tax form (1099-DA) for digital asset activity.
• For the first year, the form may not include everything needed to compute gains accurately, especially cost basis.
• If you used multiple platforms or moved assets between wallets, we need the complete transaction history to avoid mistakes.

That message prevents last-minute resistance and makes the follow-up feel normal, not suspicious.

Why this is a perfect lane for a dedicated tax support seat

Digital asset prep work is not always hard, but it is often time-consuming and detail-heavy:

• collecting platform lists and exports
• building a clean transaction summary
• reconciling proceeds totals
• documenting basis gaps and open items
• packaging the file for review

This is structured work that benefits from consistency and repeatability, which is why many firms assign it to a dedicated production lane rather than letting it sprawl across preparers’ inboxes.

The “embedded team” model is valuable here because it reduces handoff friction. As one client put it, “the Finsmart team has always felt like a part of our team. They’re included in our meetings, collaborate seamlessly.”
That kind of integration is exactly what you want when you are building a new organizer workflow and training a team to produce consistent digital asset workpapers.

If you’re scaling capacity, this work aligns naturally with Finsmart’s Accounting Seat Model and with dedicated US Tax Seats, where the goal is review-ready output inside your process.

A clean way to introduce this for 2026 without disrupting your whole firm

Digital assets don’t need to overwhelm your season if you control the intake. The practical move is to treat “digital assets present” as a flag that triggers a standard data pack and a standard workpaper set. Once that is in place, returns stop bouncing around, and reviewers stop seeing surprises late in the pipeline.

If you’d like, email [email protected] and ask for a “1099-DA organizer insert.” Share the tax software you use and how you currently handle crypto (client-provided summaries vs CSV vs third-party tools), or schedule a meeting with our team to walk through your current process. We’ll share a ready-to-copy organizer section along with a reviewer-ready workpaper outline your team can implement immediately.