Coinbase 1099-DA Alerts | Users Find Reporting Issues
Edited By
Marko Petrovic
As tax season heats up, many are facing confusion over Coinbase’s 1099-DA forms. A significant number of people are questioning the accuracy of numbers on their tax documents, arising from incomplete cost basis reporting for 2025 transactions that hit the tables in 2026.
The Problem with 1099-DA
A 1099 only reflects activity from Coinbase, leaving many with an incomplete picture of their cryptocurrency transactions. As one user noted, "So we don't need to send this form as long as we sync through Koinly, correct?" This highlights a common misunderstanding: the form won’t capture transfers and gains from other platforms. Missing out on this information could lead to:
Overpaying taxes
Underreporting income
Filing inconsistent numbers
The tax implications are significant. To avoid surprises, it's essential to assess your entire transaction history and not rely solely on the provided document.
Advice for First-Time Filer
For newcomers to crypto taxation, it’s natural to feel overwhelmed. Steps include:
Creating accounts with Koinly to reconcile transactions.
Connecting exchanges and wallets for a complete overview.
Reviewing and tagging transactions to ensure accuracy.
As one user shared, "I wish I could download the form I paid for. Only waiting on Koinly so we can file."
This reflects a growing sentiment among users as they navigate through the complexities of crypto tax reporting.
Koinly Partnership with Coinbase
To ease the process, Coinbase has partnered with Koinly. Through the Coinbase US Tax Center, users can access Koinly’s tools with exclusive discounts. This service tracks transaction history across multiple exchanges and wallets, generating Form 8949 and Schedule D accurately.
Users can reconcile for free for up to 10,000 transactions.
Fees apply only when downloading reports, ensuring minimal upfront costs. If users are unsatisfied with the reconciliation, a refund is guaranteed.
Key Points to Remember
🗸 Complete picture: Users need to consider their entire crypto activity, not just what is on the 1099 forms.
🗸 Simplified tax filing: Tools like Koinly can ease the burden of tax season.
🗸 Active support: Coinbase offers discounts to streamline filing choices, further helping people manage their crypto taxes this year.
As confusion reigns this tax season, ensuring that your finances reflect your full crypto activity is crucial. Will the tools provided be enough to clear up the confusion for everyone?
Anticipating Tax Season Twists
There’s a strong chance that as more people file their taxes, awareness about the limitations of the 1099-DA forms will increase. Expect to see a surge in inquiries directed toward Coinbase and Koinly from folks unsure about the accuracy of their information. Experts estimate around 60% of filers may reconsider their approaches to documenting transactions, leading to a boost in the utilization of comprehensive tax reporting tools. These changes could foster broader discussions on regulatory standards for cryptocurrency disclosures, ensuring taxpayers fully understand their obligations and potential entanglements with the IRS moving forward.
Historical Echoes
This scenario closely resembles the early days of online banking when individuals struggled to reconcile digital statements with traditional financial records. Just as banks became proactive in improving accessibility and clarity, crypto platforms are following similar paths. Think of how consumers learned to adapt amidst confusion over their finances back then; much like how they slowly became tech-savvy in managing their accounts. Today, as tax season approaches, people are once again faced with adapting to new financial norms in the digital sphere, where clarity is paramount.