Digital Assets and Your 2025 Tax Return: What to Know
If you had digital assets in 2025, such as cryptocurrency, NFTs, or stablecoins, it’s time to check your mailbox and inbox. Tax documents are rolling in, and this year, there’s a new form in the mix.
Form 1099-DA: New for 2025
If you sold or traded digital assets through a broker, you might receive Form 1099-DA. This form includes information the broker reports to the IRS, but it may not tell the full story. For example, most 2025 forms won’t show the asset’s cost basis. You’ll need to calculate that yourself to figure out your gain or loss.
Even if you don’t receive a Form 1099-DA, you’re still required to report all income, gains, or losses from digital assets.
Answering the Digital Asset Question
The IRS now asks everyone to answer a simple yes/no question on their tax return about digital assets. You’ll see it on forms including:
- Form 1040 and 1040-SR
- Form 1041 for estates and trusts
- Form 1065 for partnerships
- Form 1120 and 1120-S for corporations
- Form 1040-NR for nonresidents
- Form 709 for gifts
You must answer the question whether or not you engaged with digital assets during the year.
How the IRS Defines Digital Assets
Digital assets are considered property, not currency for U.S. tax purposes. The IRS defines them as any digital representation of value recorded on a cryptographically secured ledger (blockchain).
Examples include:
- Cryptocurrencies like Bitcoin
- Stablecoins
- Non-fungible tokens (NFTs)
These assets can be bought, sold, traded, or used to pay for goods and services.
Quick Summary
- Expect a Form 1099-DA if you sold or traded digital assets through a broker.
- Even without a form, you must report any related income.
- You’ll need to calculate your own gain or loss if the form doesn’t include a cost basis.
- Everyone must answer the digital asset question on their return.
Have questions?
We’re here to help you sort through the forms and figure out what applies to you. Reach out to us today.
