Key Takeaways
- The IRS has delayed crypto tax reporting requirements to January 1, 2026.
- The delay helps brokers prepare for new systems to determine cost basis for crypto assets.
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The Internal Revenue Service delayed new crypto tax reporting requirements until January 1, 2026, giving digital asset brokers an additional year to prepare for the regulatory changes.
The postponed rules focus on determining the cost basis for crypto assets held in centralized platforms. Under the regulations, if investors don’t specify an accounting method, transactions will default to a First-In, First-Out (FIFO) approach.
The delay addresses concerns from tax experts about centralized finance brokers’ readiness to implement these changes. Many brokers currently lack infrastructure to support specific identification methods that allow investors to choose which crypto units to sell.
The reporting requirements, originally scheduled for 2025, would have mandated brokers to report cost basis for crypto assets sold on centralized platforms. The extension allows investors more time to strategize their accounting methods, while giving brokers additional time to develop systems for the new reporting obligations.
In June, the US Treasury Department’s IRS established a new tax regime for crypto transactions and delayed rules for DeFi and non-hosted wallet providers.
In August, the IRS shared a revised 1099-DA tax form for crypto transactions that enhances privacy by omitting wallet addresses and transaction IDs.
In December, the IRS finalized tax reporting rules for DeFi brokers, aligning them with traditional asset reporting to aid compliant taxpayers.
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