Digital Nomad
How the 1099-DA Changes Affect Digital Asset Traders & Brokers (2025-26 Rules)
Digital asset brokers have new optional rules for furnishing 1099-DA statements electronically starting January 1, 2027—discover what that means for both brokers and traders.
By NomadicTax Research Team • 5-8 min read • April 1, 2026
## What’s Changing for Digital Asset Reporting
Starting **January 1, 2025**, brokers must report **gross proceeds** from digital asset transactions via Form 1099-DA. As of **January 1, 2026**, brokers’ reporting obligation expands to include **cost basis**, making tax reporting much more detailed. These requirements stem from final IRS regulations putting additional compliance pressure on both taxpayers and brokers. ([irs.gov](https://www.irs.gov/newsroom/final-regulations-and-related-irs-guidance-for-reporting-by-brokers-on-sales-and-exchanges-of-digital-assets?utm_source=openai))
### Proposed Relief: Easier Electronic Delivery
To reduce paperwork burdens, the IRS and Treasury proposed rules (IR-2026-29, published on **March 5, 2026**) that allow brokers to furnish 1099-DA statements **electronically** without needing a paper alternative. Key details:
- Consent from customers will still be required, but brokers won’t have to offer a paper version. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-issue-proposed-regulations-to-make-it-easier-for-digital-asset-brokers-to-provide-1099-da-statements-electronically?utm_source=openai))
- Enhanced notice and delivery rules, including notification when statements are posted to a website or app, and backup methods if email fails. ([irs.gov](https://www.irs.gov/irb/2026-13_IRB?utm_source=openai))
- These rules can be taken advantage of starting **January 1, 2027**. ([irs.gov](https://www.irs.gov/newsroom/treasury-irs-issue-proposed-regulations-to-make-it-easier-for-digital-asset-brokers-to-provide-1099-da-statements-electronically?utm_source=openai))
## Implications for Stakeholders
| Stakeholder | What to Do Now | Key Risks if Not Prepared |
|-------------|----------------|-----------------------------|
| Brokers / Exchanges | Update systems for electronic delivery, customer consent protocols, record-keeping. Begin assessing infrastructure. | Failure to provide notice or meet electronic delivery criteria could result in non-compliance penalties. |
| Traders & Investors | Ensure email/online account details are current. Understand where statements will be delivered and how to access them. | Missed statements could lead to incorrect tax filings and costly amendments. |
## Practical Examples
- **Example A**: Alice trades NFTs on a platform, gets several 1099-DA statements. Beginning 2025, she gets gross proceeds; in 2026 cost basis is added. If she prefers, the platform may offer delivery via a secure app instead of paper mail after 2027.
- **Example B**: Bob’s broker sends electronic posting notice via email, but his email bounces. The broker must follow up by mail with a fallback notice. Otherwise, the electronic furnishing may not count as valid.
## Actionable Steps Before Year-End 2026
1. Brokers should **audit consent processes**—how and when they collect and record customer consent for electronic delivery.
2. Update terms and communications to align with proposed regulations, especially notice content and accessibility.
3. Customers should review account settings to ensure statements go to the right email or portal.
4. Keep good records: dates of delivery/notification matter for compliance.
**Bottom line**: The rules aim to match the digital nature of crypto and digital assets with reporting that is less burdensome. If you’re involved in digital asset trading or reporting, getting ahead of these changes is key—both to avoid penalties and to make your tax life easier.