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IRS Issues Regs on Digital Assets

The Internal Revenue Service has issued final regulations requiring custodial brokers to report sales and exchanges of digital assets, including cryptocurrency. 

Brokers must report sale and exchange transactions that take place beginning in calendar year 2025 to be reported on the soon-to-be released Form 1099-DA. 

Brokers that take possession of the digital assets being sold by their customers are required to report. These include operators of custodial digital asset trading platforms, digital asset hosted wallet providers, digital asset kiosks, and processors of digital asset payments

The IRS said most transactions of digital assets are made via these brokers..

The final regulations do not include reporting requirements for brokers—decentralized or non-custodial brokers—that do not take possession of the digital assets being sold or exchanged. 

Also issued were rules for taxpayers to basis, gain, and loss from digital asset transactions, along with backup withholding rules. 

Bob Scott
Bob Scott has provided information to the tax and accounting community since 1991, first as technology editor of Accounting Today, and from 1997 through 2009 as editor of its sister publication, Accounting Technology. He is known throughout the industry for his depth of knowledge and for his high journalistic standards.  Scott has made frequent appearances as a speaker, moderator and panelist and events serving tax and accounting professionals. He  has a strong background in computer journalism as an editor with two former trade publications, Computer+Software News and MIS Week and spent several years with weekly and daily newspapers in Morris County New Jersey prior to that.  A graduate of Indiana University with a degree in journalism, Bob is a native of Madison, Ind
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