The Most Trusted 1099 Reporting Provider, Ready for Your Digital Asset Reporting Needs
Talk to Our Experts

  Trusted by Enterprises

BHI
c
cri
evans
Financial-soltuions
fringe-benfit
honeybaked
legacy
panera
payonner
penn
pfchang
provident-bank
rover
standish
wipel
allbirds
BHI
c
china-construction-bank
cri
evans
honeybaked

  Our Features

Platform That’s Designed for The Crypto Brokers

Transaction Data Retrieval

Our platform allows submission and retrieval of transaction data, including details like transaction type and transaction amounts.

Cost Basis Calculation

We provide functionality to calculate the basis for each transaction and will support the final basis reporting requirements as they mature.

Security and Authentication

We deliver universal security and industry leading annual SSAE-18 Type II audits to protect your data. With high-end data encryption and authorization access, our platform is completely secure.

Scalability & Performance

Designed for enterprise-scale usage, our platform can handle large data volumes efficiently, automate workflows and eliminate manual entry.

Compliance with Regulations

With built-in compliance, adhere to relevant federal and state regulations (e.g., IRS Notice 2024-56 and 2024-57).

Comprehensive Platform

Our Crypto & Digital Asset Reporting platform offers a comprehensive, end-to-end platform—from data capture to validation and reporting.

 Compliance Starts with Onboarding

Automate your User Onboarding Process!

The first step is collecting information on your account holders so you can properly report to the IRS and avoid costly penalty assessments due to reporting without a TIN or with an incorrect name/TIN combination.

W-9 Forms & Document Storage

  • Provide a digital W-9 form for users to fill out during the onboarding process. Ensure the form is user-friendly and secure.
  • Implement validation checks to ensure all required fields are filled out correctly before submission.
  • Store the collected W-9 forms securely in a database. Ensure the database complies with data protection regulations.
  • Utilize the stored W-9 forms for future information reporting purposes, such as filing 1099 forms.

TIN Matching

  • During onboarding, collect the Taxpayer Identification Number (TIN) from users.
  • Use the IRS TIN Matching Program to verify the accuracy of the TIN provided. This ensures that the TIN matches the name on the W-9 form.
  • Integrate an API that connects to the IRS TIN Matching Program to automate the verification process. This reduces manual errors and speeds up the onboarding process.
  • If there are discrepancies, notify users immediately to correct the information.

TIN Matching

  • During onboarding, collect the Taxpayer Identification Number (TIN) from users.
  • Use the IRS TIN Matching Program to verify the accuracy of the TIN provided. This ensures that the TIN matches the name on the W-9 form.
  • Integrate an API that connects to the IRS TIN Matching Program to automate the verification process. This reduces manual errors and speeds up the onboarding process.
  • If there are discrepancies, notify users immediately to correct the information.

Track Every Transaction and Sync Their Information in Real-Time

Automatically send over transactions as they occur or on a periodic basis based on the function of your internal trading system.

Accounting for High-volume Transactions

  • Icon 1 Reduce costs and simplify digital tax reporting
  • Icon 2 Eliminate manual efforts and data inconsistencies
  • Icon 3 Avoid year-end complications by providing data more frequently

Audit-ready Bookkeeping

  • Icon 1 Keep your books up-to-date with our easy workflow
  • Icon 2 Manage roles with ease, including Preparer, Approver, and Transmitter, ensuring a smooth workflow

Accounting for High-volume Transactions

  • Icon 1 Reduce costs and simplify digital tax reporting
  • Icon 2 Eliminate manual efforts and data inconsistencies
  • Icon 3 Avoid year-end complications by providing data more frequently

Audit-ready Bookkeeping

  • Icon 1 Keep your books up-to-date with our easy workflow.
  • Icon 2 Manage roles with ease, including Preparer, Approver, and Transmitter, ensuring a smooth workflow.

Your Data Security is Our #1 Priority

We deliver universal security and industry leading annual SSAE-18 Type II audits to protect your data. With high-end data encryptions, 256-bit bank-grade security standards, and authorization access, our API is completely secure.

The Industry Experts at Tax1099 Can Help You Kick-Start Your Digital Asset Reporting Process

Talk to Our Experts

The Industry Experts at Tax1099 can help you kick-Start your Digital Asset Reporting Process

Talk to Our Experts

  Who Do We Serve?

Digital Economy Compliance & Reporting for Diverse Needs
The IRS has been working through who may or may not be required to report. Be prepared just in case your business is covered. Even if you don’t think of yourself as a broker, you may find yourself being called one by the new regulations:

Digital Asset Trading Platforms

Processors of Digital Asset Payments (PDAPs)

Accounting Firms Reporting Digital Asset

Real Estate Professionals Dealing in Digital Assets

Digital Asset Kiosks

 Reporting Requirements

Latest Updates for Custodial Digital Asset Brokers
The IRS and the Treasury Department have issued final regulations requiring custodial brokers to report sales and exchanges of digital assets starting from January 1, 2025.

Gross Proceeds

Brokers must report gross proceeds from transactions beginning in 2025.

Cost Basis

Starting January 1, 2026, brokers must also report the cost basis for certain transactions.

Real Estate Transactions

Brokers involved in real estate transactions must report the fair market value of digital assets paid by buyers and received by sellers for transactions closing on or after January 1, 2026.

Exclusions

Decentralized or non-custodial brokers that do not take possession of the digital assets being sold or exchanged are not included in these regulations. The IRS plans to issue separate rules for those brokers.

Transitional Relief

For transactions occurring in 2025, the IRS will not impose penalties for failure to file and furnish Forms 1099-DA if brokers make a good faith effort to comply.

Exclusions

Decentralized or non-custodial brokers that do not take possession of the digital assets being sold or exchanged are not included in these regulations. The IRS plans to issue separate rules for those brokers.

Transitional Relief

For transactions occurring in 2025, the IRS will not impose penalties for failure to file and furnish Forms 1099-DA if brokers make a good faith effort to comply.

 FAQs

Insights on 1099-DA & Crypto Tax Reporting

What is Form 1099-DA?

Form 1099-DA is a proposed IRS form for reporting digital asset transactions. It aims to capture information related to sales or exchanges of digital assets, including cryptocurrencies. The form is still in draft mode, and its final version may undergo changes before implementation.

Who needs to file Form 1099-DA?

Brokers: This includes digital asset trading platforms, payment processors, and certain wallet providers. 

Reporting applies to sales or exchanges of digital assets occurring on or after January 1, 2025. 

When will Form 1099-DA be released?

As of now, the form is still in draft mode. The IRS has not announced an official release date. Stay informed about updates from the IRS to ensure timely compliance. 

Why should crypto exchanges & digital asset providers prepare for Form 1099-DA?

Compliance: Brokers, including crypto exchanges and digital asset providers, are required to report digital asset transactions to the IRS with penalties for non-reporting, incorrect reporting and withholding requirements as an incentive to comply.

What to report on Form 1099-DA?

Form 1099-DA will primarily report information that helps taxpayers calculate capital gains from digital assets, as well as ordinary income. This includes:

  1. When you got the digital asset (Acquisition date)
  2. How much you paid for it (Cost basis)
  3. When you sold or swapped it (Sale or disposition date)
  4. How much money you got from selling or swapping it (Sales proceeds)
  5. Many more fields, some are not yet fully defined!

What’s not required to be reported in Form 1099-DA?

According to Notice 2024-57, brokers will not have to report the following types of transactions on Form 1099-DA until the IRS issues further guidance:

  1. Wrapping and unwrapping transactions
  2. Liquidity provider transactions
  3. Staking transactions
  4. Transactions described by digital asset market participants as lending of digital assets
  5. Transactions described by digital asset market participants as short sales of digital assets
  6. Notional principal contract transactions