How to Report Crypto on Form 8949

Report every crypto sale on IRS Form 8949, then summarize on Schedule D. A step-by-step guide to the columns, the new 1099-DA, and short vs long-term boxes.

Updated July 2026 · Educational only, not tax or financial advice

You report each crypto sale on IRS Form 8949, then carry the totals to Schedule D and Form 1040 — short-term and long-term go in separate sections

The IRS now matches your Form 8949 against broker 1099-DA data. A mismatch can trigger an automated CP2000 notice, so getting the form right matters.

See free crypto tax tools →

Topic

How-to

Why it matters

The IRS now matches your Form 8949 against broker 1099-DA data. A mismatch can trigger an automated CP2000 notice, so getting the form right matters.

The direct answer

You report crypto sales on IRS Form 8949, then carry the totals to Schedule D and Form 1040. This is educational only, not tax or financial advice — consult a tax professional. Because crypto is property under Notice 2014-21, every sale, trade, or spend is a disposal that belongs on Form 8949.

Form 8949 lists each transaction line by line. You enter the asset, the dates, the proceeds, the cost basis, and the gain or loss. Short-term and long-term disposals go in separate parts of the form.

Schedule D then summarizes those totals. It nets your short-term and long-term results, applies any loss carryforward, and produces the number that flows to Form 1040.

A new form matters here too. Starting with 2025 transactions, brokers issue Form 1099-DA. The IRS matches it against your Form 8949, so accuracy protects you from an automated notice. Below is the step-by-step.

How it works

Form 8949 works as the detail sheet for capital asset sales, and crypto disposals go on it because the IRS treats crypto as property. Each row captures one disposal: a description, the date acquired, the date sold, the proceeds, the cost basis, any adjustment, and the resulting gain or loss.

The form has two parts. Part I is for short-term disposals, held one year or less, taxed at ordinary income rates. Part II is for long-term disposals, held more than a year, taxed at the lower 0/15/20% capital-gains rates. Crypto often fills both parts.

Each part also has boxes A through C (and the new digital-asset boxes) that describe whether a 1099 reported your basis. For 2025, brokers file Form 1099-DA showing gross proceeds. Cost basis reporting on 1099-DA is scheduled to begin with 2026 transactions, so early forms may show proceeds only.

Schedule D is the summary. It pulls the short-term totals from Form 8949 Part I and the long-term totals from Part II. It nets gains against losses, applies prior-year carryforward, and computes your net capital gain or loss.

The final number flows to Form 1040. A net gain adds to your taxable income. A net loss offsets up to $3,000 of ordinary income per year under IRC §1211, with any excess carried forward. Collectible NFTs feed a separate 28% rate worksheet within Schedule D.

Step by step

1Gather every disposal for the year — sales, crypto-to-crypto trades, and purchases of goods with crypto all count as disposals under Notice 2014-21.
2For each disposal, record the description, date acquired, date sold, proceeds in US dollars, and cost basis including fees.
3Sort each disposal into short-term (held one year or less) or long-term (held over one year) — they go in Part I and Part II of Form 8949.
4Enter each transaction on Form 8949, computing gain or loss as proceeds minus cost basis, with any needed adjustment in column (g).
5Reconcile your entries against any Form 1099-DA you received; for 2025 it typically shows gross proceeds, with basis reporting starting for 2026.
6Carry the Part I and Part II totals to Schedule D, which nets your gains and losses and applies any loss carryforward.
7Transfer the Schedule D result to Form 1040, and remember a net loss offsets up to $3,000 of ordinary income, with the rest carried forward.

When it helps

Form 8949 gives you a clean, line-by-line record that directly supports the totals on Schedule D and Form 1040.
Separating short-term and long-term disposals ensures long-held crypto gets the lower 0/15/20% long-term rate it qualifies for.
Accurate 8949 entries let you reconcile against broker 1099-DA data, reducing the chance of an automated CP2000 notice.
The form captures losses too, which flow through Schedule D to offset gains and up to $3,000 of ordinary income each year.

Watch-outs

Every crypto-to-crypto trade is a separate disposal, so active traders can face hundreds of Form 8949 lines in a year.
For 2025, Form 1099-DA generally reports gross proceeds without cost basis, so you must supply your own basis or risk overpaying.
A mismatch between your Form 8949 and the broker's 1099-DA can trigger an IRS CP2000 notice through automated matching.
Missing cost basis from old wallets or defunct exchanges makes some 8949 entries hard to complete accurately.
Collectible NFTs and certain transactions need extra worksheets or adjustment codes, adding complexity to the filing.

Common questions

What form do I use to report crypto on my taxes?

You report crypto sales and trades on IRS Form 8949, then summarize the totals on Schedule D, which flows to Form 1040. This is educational only, not tax advice. Because the IRS treats crypto as property, every sale, crypto-to-crypto trade, or purchase of goods with crypto is a disposal that belongs on Form 8949.

What is the difference between Form 8949 and Schedule D?

Form 8949 lists each individual crypto disposal with its dates, proceeds, cost basis, and gain or loss. Schedule D summarizes those entries — it nets short-term and long-term results, applies any loss carryforward, and produces the total that flows to Form 1040. In short, Form 8949 has the detail and Schedule D has the summary.

What is Form 1099-DA?

Form 1099-DA is a new IRS form that digital asset brokers must issue starting with 2025 transactions, with the first forms arriving in early 2026. For 2025 it generally reports gross proceeds only. Cost basis reporting is scheduled to begin with 2026 transactions. The IRS matches 1099-DA data against your Form 8949, so your figures should reconcile.

Do I report crypto-to-crypto trades on Form 8949?

Yes. Trading one cryptocurrency for another is a taxable disposal of the coin you gave up, so it belongs on Form 8949. You report the fair market value received as proceeds and subtract your cost basis to find the gain or loss. This is true even though no US dollars changed hands, because crypto is property.

Where do short-term and long-term crypto go on Form 8949?

Short-term disposals, meaning crypto held one year or less, go in Part I of Form 8949 and are taxed at ordinary income rates. Long-term disposals, held more than one year, go in Part II and qualify for the lower 0/15/20% capital-gains rates. Both parts then feed Schedule D, which nets the totals.

What happens if my 8949 doesn't match my 1099-DA?

A mismatch between your Form 8949 and a broker's Form 1099-DA can trigger an IRS CP2000 notice through the Automated Underreporter system, without a full audit. The notice proposes additional tax based on the difference. You can respond with your records — often the gap is missing cost basis that the 1099-DA did not report for 2025 transactions.

Sources

Ready to put this into practice?

Exchange sign-up bonuses pay both you and a referrer after a qualifying trade.

See bonuses →