Prepare digital asset records for your personal return

A wallet balance is a starting point, not a history of the transactions behind it. Before a personal return is prepared, collect records of purchases, payments, transfers and sales. Label the records by account and tax year, and flag anything you cannot reconcile. The IRS digital assets guide explains the federal reporting question and recordkeeping requirements.

This guide helps you assemble information. It does not determine your tax, choose a basis method or calculate the value of a transaction.

Start with the return question

The IRS asks about receiving, selling, exchanging or otherwise disposing of digital assets during the tax year. Its examples for answering no include only holding assets, purchasing them with real currency without selling, and transferring assets between wallets you own or control. Those examples do not settle the answer if another activity during the year requires a yes; review the entire year. The IRS makes an exception when a transfer fee is paid with digital assets: that fee is a digital asset transaction.

The IRS lists payments for services, rewards, mining or staking, sales and exchanges among events that may lead to a yes answer. The full circumstances matter. Write down what happened, when, and whether a transfer included a fee, then use the IRS instructions for the return year or discuss the answer with your preparer.

Assemble the transaction history

For each account or wallet, identify when assets were acquired and when they were sold, exchanged or otherwise disposed of. Keep the type of asset, transaction date and time, number of units, dollar value and basis information together where available. The IRS identifies these details as relevant to calculating gain or loss on a disposal.

Preserve original account statements or exports and keep your notes separate. If an export treats a transfer between your own accounts as a sale, mark it for review instead of silently altering the original. Record gaps such as a missing acquisition history or an account you can no longer access. Do not assume a zero balance means there were no transactions.

If you received assets for work, a reward or another activity, keep the records that show what you received and when. A preparer needs the facts to determine the proper treatment; a list of closing balances alone cannot establish it.

Trace a transfer across accounts

Suppose you moved an asset from an exchange account to a wallet you control, then later sent it back and sold part of it. An export from the exchange may show an outgoing entry and an incoming entry without explaining the history in the wallet. Gather both sides of the movement, the wallet history where available, and the later sale record. Note the transaction date, asset and units for each entry so your preparer can follow the path and investigate mismatches.

Identify any transaction fee separately, including what asset paid it. A transfer between wallets you control is one of the IRS examples for answering no to the return question when no other activity requires a yes, but the IRS treats paying a transfer fee with digital assets as a transaction. The example alone cannot settle how every entry in a particular history should be reported. If the records do not match, note whether the missing information concerns the amount moved, the fee or the original acquisition. Ask for help before relying on an automated label.

Document assets received as income

When an asset was received for services or another activity, provide the event details as well as any later disposition. The IRS says to keep records of the fair market value in U.S. dollars of assets received as income or in the ordinary course of a trade or business. Save the statement or other evidence showing what was received and its value at the time, if available, and explain any uncertainty about the source or date.

For instance, a later sale record may show proceeds without explaining whether the units originally came from a purchase or a payment for work. Keep those facts together, but do not assume the later sale record resolves the earlier event. A preparer can use the records and the applicable rules to determine the reporting treatment. If the value or acquisition evidence is missing, identify the gap rather than filling it with a guess.

Compare broker statements with your own records

Some brokers issue Form 1099-DA for digital asset proceeds. The IRS digital assets page says its final broker regulations phase in gross proceeds reporting for transactions effected on or after January 1, 2025, and basis reporting for certain transactions effected on or after January 1, 2026. Those are transaction dates, not form issue dates. The IRS discusses 2025 transactions reported in 2026. Conditions and exceptions apply, so do not assume every transaction or every basis amount appears on a form.

Compare a statement to your own acquisition and transfer records. A blank basis field does not automatically mean the asset had zero basis; identify the missing acquisition evidence and ask the preparer how the applicable rules and records affect the return. Flag a difference and ask what evidence is needed. Retaining your records is useful even when a broker sends a statement.

Use IRS guidance for the transaction date. The IRS digital assets page says its Part I virtual-currency FAQs generally apply to transactions completed before January 1, 2025, while Part II generally applies to digital-asset transactions completed on or after that date. Do not treat an older FAQ as a universal rule for every later transaction; ask the preparer to check the applicable current guidance.

Connect each event to the return

Answering the digital assets question does not replace reporting the income or disposition. The IRS reporting overview directs sales, exchanges and other dispositions of digital assets held as capital assets to Form 8949. Keep the acquisition and disposition records together so the preparer can review the relevant transaction and applicable schedules.

The same overview distinguishes employee wages reported on Form 1040 from digital assets received as payment by an independent contractor, which it directs to Schedule C. Tell the preparer why you received an asset; a later sale may be a separate event from receiving payment for work. Do not put every receipt into one category solely because it arrived in the same wallet.

For rewards, staking, mining, gifts or other events, identify the activity and ask which reporting rules apply to your facts and transaction year. An information return is evidence to reconcile, rather than a substitute for deciding where the underlying event belongs.

Prepare questions when records disagree

Compare the name and year on each statement with the account history you collected. Is a sale missing from an export? Does a form show proceeds while acquisition information is absent or different? Did the asset move through another account before the sale? Record the discrepancy and where each figure came from. Ask the broker about an apparent statement error and ask your preparer which evidence is needed to reconcile it; do not alter a form yourself.

A useful handoff distinguishes the original statement, supporting transaction history and your own notes. Tell the preparer if an account is inaccessible, if a history starts after you acquired an asset, or if the records mix activity belonging to different people. Ask how an unresolved gap affects preparation and what additional evidence could help. A statement's presence or absence does not by itself settle your return obligations.

Keep sensitive access information private

Transaction records can include sensitive financial information. Ask the preparer how to share records safely; do not send wallet keys or recovery phrases with a tax packet. The IRS warns against letters directing recipients to register cryptocurrency through a supposed digital assets compliance portal. Its guidance says it does not require such registration and is not sending those letters.

For the rest of your return packet, use the personal document checklist. Keep digital asset records labeled by person if you are considering a joint return.