The Internal Revenue Service (IRS) has clarified that taxpayers must report income, gains, or losses from digital asset transactions on their 2025 federal income tax returns, regardless of whether they receive Form 1099-DA, Digital Asset Proceeds From Broker Transactions.

A digital asset is any form of value that exists electronically and is tracked using secure technology like a blockchain. Digital assets include convertible virtual currencies and cryptocurrencies such as Bitcoin, stablecoins, and non-fungible tokens (NFTs). Digital assets do not include cash, such as U.S. dollars or foreign currencies issued by governments or central banks.

The broker must file Form 1099-DA for each digital asset sale completed for a customer in the year 2025. Brokers are required to furnish Form 1099-DA to taxpayers by February 17, 2026, to file corresponding information with the IRS.

In addition, all taxpayers are required to respond to the digital asset question on their federal income tax return by selecting either “yes” or “no,” regardless of whether they engaged in any digital asset transactions during the year.

The IRS has issued guidance to assist taxpayers in this regard. For questions regarding digital asset reporting or assistance with compliance, please contact your tax advisor.