Why this becomes a 2026 tax problem
For sales after 2025, brokers must report basis for covered digital assets. But the IRS specifically classifies transferred-in digital assets as noncovered. That means a taxpayer can have a perfectly real purchase cost while the receiving broker is not required to report that basis to the IRS.
| Situation | 1099-DA consequence | Record you need |
|---|---|---|
| Bought at the broker in 2026 and remained in its custody | May be covered; required basis reporting can apply. | Broker acquisition and sale records. |
| Bought before 2026 | Noncovered under IRS rules. | Original acquisition date, price and fees. |
| Transferred from another exchange or wallet | Transferred-in units are noncovered. | Original acquisition record plus the transfer trail. |
| Basis box is blank | Do not automatically treat blank as $0. | Reconstruct basis from source records. |
The rule that prevents a costly assumption
The IRS says customer-provided acquisition information may be used by a broker for certain lot-ordering purposes, but the broker may not rely on that information to report basis for transferred-in units on Form 1099-DA. So adding purchase information to a platform can improve records without necessarily turning a transferred asset into broker-reported covered basis.
Coinbase, Robinhood and Kraken: what to check
| Platform | What to verify | Next page |
|---|---|---|
| Coinbase | Whether the units were acquired there or transferred in, and whether the platform has complete acquisition details. | Coinbase 1099-DA guide |
| Robinhood | Whether outside-wallet transfers created gaps between your acquisition history and the platform's records. | Robinhood 1099-DA guide |
| Kraken | Whether the Tax Center/export history contains the information needed to reconnect transferred units to their original acquisition. | Kraken 1099-DA guide |
Reconstruct the transfer trail before you guess at basis
- Locate the original acquisition: date, amount paid, quantity and fees.
- Match the withdrawal from the sending exchange or wallet to the receiving deposit.
- Preserve transaction IDs, wallet addresses and timestamps where available.
- Separate transfers between your own accounts from sales, swaps or payments.
- Compare the reconstructed lots with the eventual Form 1099-DA and platform exports.
Multiple exchanges or wallets?
If the trail spans several platforms, manual matching can become the bottleneck. Reconciliation software can help organize imports and transfers, but it cannot invent missing acquisition evidence.
Affiliate disclosure: we may earn a commission if you purchase through these links, at no additional cost to you. Check software output against source records.
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Frequently asked questions
Does transferred crypto have cost basis on Form 1099-DA?
Transferred-in crypto is noncovered under the IRS 2026 broker-reporting rules. The receiving broker may leave basis blank even though you have an actual basis in your own records.
Does blank basis mean my basis is zero?
No. IRS instructions say zero should be entered only when the asset actually had zero basis. A blank basis for a noncovered asset can instead mean basis was not reported by the broker.
Can I give the receiving broker my old purchase price?
Current IRS guidance allows customer-provided acquisition information for certain lot-ordering purposes, but says it cannot be used by the broker to report basis for transferred-in units on Form 1099-DA.