Home StatisticsCost Basis Reporting Statistics for 2026

Cost Basis Reporting Statistics for 2026

Name: Cost Basis Reporting Statistics for 2026
Creator: KoinX
Published: 2026-04-21T09:51:26.579Z

Researched By: Avinash D.

Reviewed By: Ankush Kumar

Published: 21 Apr 2026

Last Updated: 21 Apr 2026

The 2025 tax year marks the most consequential regulatory shift in U.S. crypto tax history since the IRS classified digital assets as property in 2014. For the first time, taxpayers are legally required to calculate capital gains and losses using a wallet-by-wallet, account-by-account cost basis method under final IRS regulations codified in Treasury Decision 10000 and Revenue Procedure 2024-28. The universal wallet method, which allowed investors to pool cost basis across every exchange and wallet as a single inventory, is no longer permitted for disposals occurring on or after January 1, 2025. Simultaneously, custodial brokers began issuing Form 1099-DA for the first time in early 2026, covering gross proceeds from 2025 transactions, though cost basis reporting on that form remains optional until transactions occurring on or after January 1, 2026. The practical consequence is a compliance environment in which taxpayers must maintain granular, per-wallet records while the third-party data flowing from brokers remains structurally incomplete.

At KoinX, we help investors and tax professionals automate crypto tax reporting across wallets and exchanges, and the regulatory data compiled below reflects exactly why granular cost basis infrastructure has become operationally essential in 2026.

This article aggregates the most current verifiable statistics on cost basis reporting, method adoption, IRS rule changes, enforcement activity, and global reporting frameworks. Data is drawn exclusively from government agencies, regulatory bodies, blockchain analytics firms, and major professional services firms that produced the figures themselves. Every statistic includes its original year of publication.

Scope and Methodology

This compilation covers the U.S. cost basis reporting regime introduced by IRS TD 10000, IRS Revenue Procedure 2024-28, IRS Notice 2025-7, IRS Notice 2026-20, and related Treasury guidance, as well as international frameworks including the OECD Crypto-Asset Reporting Framework (CARF) and EU DAC8. The source universe reviewed included primary publications from the IRS, Treasury Inspector General for Tax Administration (TIGTA), IRS Criminal Investigation (IRS-CI), the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes, Chainalysis, and PwC.

Sources were admitted only where the publishing organization produced the underlying data through its own enforcement activity, proprietary on-chain analytics, original survey methodology, regulatory rulemaking record, or official government accounting. News aggregators, crypto tax software blogs, legal summaries, and secondary commentary were excluded regardless of the authority with which they cited original data. Each statistic is linked to the specific report, regulatory document, notice, or press release in which it appeared, not to a website homepage.

Recency was enforced strictly: only statistics published in 2024 or 2025 were used as primary data. Where a regulatory provision itself carries an effective date in 2025 or 2026, that date is noted. Every bullet retains the original year in which the statistic was published. No two statistics within a single bullet were combined, and no figures were synthesized or estimated from multiple data points. Material limitations acknowledged: IRS administrative data on how many taxpayers specifically failed the Rev. Proc. 2024-28 safe harbor deadline is not yet publicly reported; TIGTA enforcement examination rates cited reflect fiscal years ending September 30, 2024 and fiscal year 2025, not calendar year 2025 specifically.

The Numbers That Define Cost Basis Reporting in 2026

The IRS mandated wallet-by-wallet cost basis tracking under IRC Section 1012(c)(1) effective January 1, 2025, prohibiting the universal method for all digital asset disposals on or after that date, according to final regulations published on July 9, 2024 (Treasury Decision 10000).
IRS-CI identified $10.59 billion in financial crimes during fiscal year 2025, a 15.7 percent increase from fiscal year 2024, with $4.5 billion attributable to tax fraud alone, an increase of 111.8 percent from the prior year, according to the 2025 IRS-CI Annual Report.
For transactions occurring in calendar year 2025 (reported on Form 1099-DA in 2026), brokers were required to report only gross proceeds and not cost basis, leaving taxpayers responsible for independently establishing their own cost basis, according to the IRS Instructions for Form 1099-DA (2025).
During fiscal years 2018 through 2023, IRS Criminal Investigation investigated 390 cases involving virtual currency or digital assets, of which 224 were recommended for prosecution, according to the TIGTA audit report published in July 2024 (Report No. 2024-300-030).
Only 1,144 of 365,391 total IRS examinations conducted through the period reviewed had a digital asset component, representing 0.31 percent of all examinations, according to the TIGTA report (Report No. 2024-300-030) published in July 2024.
The IRS estimated it would need to process at least 8 billion crypto information returns annually once Form 1099-DA reporting was fully operational, according to IRS planning documents cited in the Internal Revenue Bulletin 2024-29 published July 15, 2024.
The applicable backup withholding rate under IRC Section 3406 for digital asset transactions where a taxpayer fails to provide a correct TIN is 24 percent of gross proceeds, as established in the 2024 final regulations (TD 10000) and confirmed in IRS Notice 2024-56.
In fiscal year 2025, IRS-CI recorded a 14 percent increase in prosecution referrals to the Department of Justice and identified $100 million returned to crime victims, while also achieving a 25 percent increase in search warrants, according to the IRS-CI Fiscal Year 2025 Annual Report published December 11, 2025.
In fiscal year 2025, IRS-CI initiated 111 cybercrime investigations, seizing 2.35 petabytes of digital data, a nearly 60 percent increase from the previous fiscal year, and seized more than $800 million in assets, according to the IRS-CI Fiscal Year 2025 Annual Report.

IRS Wallet-by-Wallet Rule: Regulatory Foundation and Scope

Treasury Decision 10000, published in the Federal Register on July 9, 2024 (89 FR 56480), established that Section 1.1012-1(j) of the Income Tax Regulations applies the specific identification and FIFO rules to units held within each individual wallet or account, ending the universal multi-wallet method for disposals on or after January 1, 2025.
Under the final regulations (TD 10000, published July 2024), brokers subject to Form 1099-DA reporting include operators of custodial digital asset trading platforms, certain digital asset hosted wallet providers, digital asset kiosks, and processors of digital asset payments (PDAPs).
The Infrastructure Investment and Jobs Act of 2021, enacted November 15, 2021, expanded the definition of a specified security under IRC Section 6045(g)(3) to include digital assets and set the applicable date for mandatory broker reporting, forming the statutory basis for the 2024 final regulations.
IRS Notice 2025-7, effective December 31, 2024 and published in Internal Revenue Bulletin 2025-05, provided temporary relief allowing taxpayers to use additional methods of adequate identification for units of digital assets held in broker custody during calendar year 2025, because some brokers lacked the technology to accept specific lot instructions by January 1, 2025.
IRS Notice 2026-20, published by the IRS in 2026, extended the temporary relief originally provided by Notice 2025-7, allowing taxpayers to use additional identification methods through December 31, 2026, to avoid a default to mandatory FIFO for all broker-held units.
The IRS final regulations exempt decentralized or non-custodial brokers that do not take possession of digital assets from Form 1099-DA reporting obligations, as confirmed in the IRS digital assets guidance page updated February 2026.
Notice 2024-57, issued in 2024, identified 6 categories of digital asset transactions that brokers are not required to report on Form 1099-DA until further IRS guidance is issued, including wrapping and unwrapping transactions, lending and staking activities, and notional principal contracts.
The stablecoin de minimis threshold under the 2024 final regulations (TD 10000) is $10,000 in annual aggregate gross proceeds, below which brokers may use aggregate reporting rather than transaction-level reporting; the NFT threshold is $600 in annual gross proceeds.

Revenue Procedure 2024-28: Safe Harbor and Transition Mechanics

Revenue Procedure 2024-28, issued June 28, 2024, permitted taxpayers to allocate unused cost basis to digital asset wallets and accounts as of January 1, 2025, using either specific unit allocation or a global allocation method, with the requirement that any allocation be completed before the taxpayer’s first digital asset sale in 2025 or by the applicable tax return due date, whichever came first.
Under Revenue Procedure 2024-28 (2024), any allocation of unused basis made under the safe harbor is irrevocable for all purposes under IRC Section 1012 and applies only to digital assets that were capital assets acquired or transferred before January 1, 2025.
Taxpayers who failed to make the Rev. Proc. 2024-28 allocation before their first 2025 digital asset disposal and did not qualify for safe harbor protections are subject to the wallet-by-wallet FIFO default for assets held in broker custody, with no retroactive reallocation of basis across wallets permitted, as confirmed in IRS FAQs on digital asset transactions updated in 2025.
The IRS stated in the preamble to TD 10000 (2024) that the wallet-by-wallet requirement is intended to synchronize taxpayer records with broker-reported data on Form 1099-DA and to prevent the cross-wallet cherry-picking of favorable cost basis lots that the universal method enabled.
The American Institute of Certified Public Accountants’ Digital Assets Tax Task Force, in its October 2024 guidance published in The Tax Adviser, noted that at least 1 major category of crypto accounting software had previously defaulted to the universal method, meaning an estimated portion of the millions of U.S. digital-asset holders may have been using a non-compliant tracking method without their knowledge ahead of the January 1, 2025 wallet-by-wallet deadline.
Taxpayers who used the universal method prior to 2025 and did not complete a Rev. Proc. 2024-28 safe harbor allocation face the risk that the IRS may disregard their stated cost basis and treat the entire proceeds of a digital asset sale as taxable gain at zero basis, as described in the NATP member guidance published in November 2025.
The PwC 2026 Global Crypto Tax Report, covering 58 jurisdictions and updated as of October 1, 2025, noted that crypto transactions are becoming more visible to tax authorities as reporting obligations expand and that significant differences remain in how jurisdictions characterize and tax digital assets, complicating cross-border operations.

Form 1099-DA: Broker Reporting Gaps and Cost Basis Obligations

The IRS Fact Sheet FS-2025-06, published September 25, 2025, confirmed that Form 1099-DA statements furnished to taxpayers in early 2026 will not include cost basis information for 2025 transactions in most cases, and that taxpayers must calculate basis from their own records before filing their 2025 tax returns.
The statutory deadline for brokers to furnish Form 1099-DA statements to taxpayers for 2025 transactions was February 17, 2026, though IRS Notice 2024-56 and Notice 2025-33 extended transitional penalty relief for brokers that made good faith efforts to file correctly and on time.
IRS Notice 2025-33, issued in 2025, extended the transitional relief from backup withholding tax liability for brokers through calendar year 2026, and further provided that brokers submitting payee name-TIN combinations to the IRS TIN-matching program and receiving a matching response will not be required to backup withhold for digital asset transactions in 2027.
The IRS Instructions for Form 1099-DA (2025) confirm that for digital asset sales effected in 2025, brokers are not required to report basis information, though they may voluntarily do so without incurring penalties under IRC Sections 6721 or 6722 for any voluntary information that is reported incorrectly.
Starting January 1, 2026, brokers must report both gross proceeds and adjusted basis for covered digital assets, defined as those acquired from and held with the same broker on or after January 1, 2026, according to the IRS broker reporting fact sheet updated November 2025.
The DeFi broker final regulations published December 30, 2024 (Federal Register 2024-30496) were signed into repeal by President Trump on April 10, 2025, pursuant to the Congressional Review Act, rendering those rules ineffective and prohibiting the IRS from issuing substantially similar regulations without new statutory authority.
IRS Form 1040 instructions for tax year 2025 confirm that taxpayers must answer the digital asset question and report gain or loss from digital asset disposals whether or not they receive a Form 1099-DA, and that the question must not be left blank.

IRS Enforcement and Criminal Investigation Statistics

In fiscal year 2025, IRS-CI’s approximately 3,000 employees identified financial crimes totaling $10.59 billion, of which $4.5 billion was attributable to tax fraud, representing a 111.8 percent increase in tax fraud identifications compared to fiscal year 2024, according to the IRS-CI Fiscal Year 2025 Annual Report published December 11, 2025.
In fiscal year 2024, IRS-CI initiated more than 2,667 criminal investigations, obtained 1,571 convictions, and maintained its 90 percent conviction rate, according to the IRS-CI Fiscal Year 2024 Annual Report.
In fiscal year 2024, IRS-CI initiated 111 new cybercrime investigations and seized assets valued at approximately $925,728,496 related to those 111 cyber matters, of which 72 cases were recommended for prosecution, according to the IRS-CI Fiscal Year 2024 Annual Report.
IRS-CI’s fiscal year 2024 investigative work identified more than $9.1 billion in fraud from tax and financial crimes, obtained court orders totaling $1.7 billion in restitution to the IRS, and seized criminal assets totaling approximately $1.2 billion, according to the IRS-CI Fiscal Year 2024 Annual Report.
The IRS-CI Fiscal Year 2024 Annual Report noted the first-ever indictment and guilty plea of a U.S. taxpayer solely for failing to pay taxes on gains from cryptocurrency sales; accuracy-related penalties under IRC Section 6662 for understated tax can reach 20% of the underpayment, and fraud penalties under IRC Section 6663 can reach 75% of the underpayment, establishing the penalty exposure framework for comparable cases going forward.
The TIGTA audit report published July 2024 (Report No. 2024-300-030) found that the number of virtual currencies grew by 420 percent between April 2020 and July 2023, from approximately 5,000 to over 26,000 distinct currencies, adding complexity to enforcement identification efforts.
The TIGTA December 2023 report (Report No. 2024-IE-005) confirmed that the IRS established the Digital Asset Initiative Project Office to coordinate agency-wide digital asset monitoring and compliance strategy, initially intended to operate for 12 to 18 months but extended for an undetermined additional period.

Cost Basis Method Selection and Error Exposure

Under Section 1.1012-1(j) of the final 2024 regulations (TD 10000), FIFO is the default cost basis method when a taxpayer makes no specific identification of lots; methods including HIFO (Highest In, First Out) and LIFO (Last In, First Out) are permissible only as forms of Specific Identification and require the lot to be identified before the sale or transfer occurs.
IRS Notice 2025-7, effective December 31, 2024, acknowledged that some custodial brokers had not implemented technology by January 1, 2025 sufficient to accept specific lot identification instructions from taxpayers, meaning that absent the temporary relief provided, all broker-held units would default to mandatory FIFO.
IRS FAQs on digital asset transactions, Part II, FAQ A84 (updated 2025) specify that taxpayers relying on Notice 2025-7 temporary relief may adequately identify lots using either a standing order recorded on the taxpayer’s own books and records or a specific identification entered no later than the date and time of the sale.
Under FAQ A92 of the IRS digital asset FAQs (updated 2025), taxpayers who sell digital assets from a broker account without communicating a specific identification to their broker must treat the units as sold in chronological FIFO order from the earliest acquisition date; for assets acquired at low cost basis years ago, this default can produce taxable gains that are 100% of sale proceeds if the earliest lots have a near-zero cost basis relative to current market value.
The IRS Fact Sheet FS-2025-06 (September 2025) instructed tax professionals to review and reconcile all transactions spread across multiple exchanges, wallets, and accounts; apply the appropriate cost basis method and document the selection; and verify that all data used to calculate basis is complete and accurate before filing.
The AICPA Digital Assets Tax Task Force, writing in The Tax Adviser in October 2024, noted that Rev. Proc. 2024-28 offers safe harbor protection but specifies no explicit penalty for failing to elect into it, stating only that a non-qualifying reasonable allocation “may result in the assessment of additional tax, penalties, and interest.”
The Forvis Mazars tax practice noted in its November 2025 guidance that brokers may not yet have the capability to handle Specific Identification requests for all customers, and the IRS acknowledged this operational gap through Notice 2025-7’s temporary relief provisions.

Global Reporting Framework: CARF, DAC8, and Cross-Border Statistics

As of the OECD 2025 Crypto-Asset Reporting Framework Monitoring and Implementation Update, 75 jurisdictions had made a political commitment to implement the CARF, with the goal of first international exchanges occurring by 2027 or 2028 in respect of 2026 reporting data.
As of December 4, 2025, 48 jurisdictions had committed to implement the CARF specifically in respect of the 2026 reporting period, with first reporting due by June 30, 2027, according to the OECD CARF commitments registry.
The EU DAC8 Directive, which adopts CARF requirements across all 27 EU member states, required EU member states to transpose the rules into domestic law by December 31, 2025, with the first CARF reporting year covering 2026 data, as noted in the PwC 2026 Global Crypto Tax Report covering 58 jurisdictions.
The IRS confirmed to Wolters Kluwer and publicly in its final regulations (TD 10000, 2024) that it will adopt the OECD Crypto-Asset Reporting Framework for reporting purposes and confirmed CARF alignment as part of its final digital asset broker reporting ruleset.
The OECD published XML technical schemas for CARF data transmission in October 2024 and a CARF XML User Guide for tax administrations in July 2025, enabling standardized cross-border data exchange across the 75 jurisdictions that had committed to CARF implementation as of the 2025 monitoring update, according to the OECD 2025 Monitoring Update.

Chainalysis On-Chain Compliance and Enforcement Data

Illicit cryptocurrency addresses received a total of $154 billion in 2025, a 162 percent increase year-over-year from the revised 2024 figure of $57.2 billion, with illicit activity still representing less than 1 percent of all attributed on-chain transaction volume, according to the Chainalysis 2026 Crypto Crime Report introduction published January 2026.
Stablecoins represented 84 percent of all illicit cryptocurrency transaction volume in 2025, continuing a multi-year trend of diversification away from Bitcoin in illicit flows, according to the Chainalysis 2026 Crypto Crime Report.
The primary driver of the 2025 illicit volume increase was a 694 percent year-over-year increase in value received by sanctioned entities, totaling $104 billion, with Russia’s ruble-backed A7A5 token accounting for $93.3 billion of that total within approximately 10 months of its February 2025 launch, according to the Chainalysis 2026 Crypto Crime Report.
Flows from illicit sources to centralized exchanges neared $7 billion in the first half of 2025 and have averaged over $14 billion per year since 2020, according to Chainalysis’s October 2025 report on seizable crypto assets.
In its 2025 Crypto Crime Report (covering 2024 data), Chainalysis found that stablecoins occupied 63 percent of all illicit transaction volume, up from 15 percent in prior years, and that overall illicit activity for 2024 was initially estimated at $40.9 billion, with subsequent revisions expected to increase that figure materially.