Crypto tax filing can be difficult because activity often happens across multiple exchanges and wallets over time. You might buy crypto with cash, move it between wallets, pay network fees, and sell it months later. Each disposal must be reported with the correct date, proceeds, and cost basis. This is why the IRS uses the 8949 Form, where crypto sales and exchanges are listed transaction by transaction and can be matched against broker and third-party reports.
This guide outlines the purpose behind the 8949 form, what each field is actually requesting and how to generate a clean and defensible report with CRPTM. It also demonstrates the relationship between the form 8949 form and Schedule D, and how to reason without becoming lost in the tax jargon about newer reports of digital assets, such as Form 1099-DA.
What Is The 8949 Form?
Form 8949 is used to list each sale or exchange of a capital asset, including crypto. You report the date, proceeds, cost basis, and gain or loss for every disposal. The totals from the 8949 Form are then carried over to Schedule D, where your total capital gains and losses are calculated.
Crypto fits into this process because the IRS treats digital assets as property, not currency. As a result, most crypto disposals are reported as capital asset transactions on 8949 Form.
Which Crypto Actions Belong on the 8949 Form
Before touching the form 8949 form, separate what is a disposal from what is just movement. This one distinction prevents a lot of bad crypto tax math later.
Disposals That Usually Go on the 8949 Form
Most taxpayers will list these on the 8949 Form when they occur:
- Selling crypto for USD (or another fiat currency)
- Trading one token for another token
- Spending crypto on goods or services
- Disposing of crypto to pay certain transaction costs when paid in digital assets
The IRS guidance treats digital asset transactions as reportable, and Notice 2014-21 applies property principles to common virtual currency transactions. That is why a swap can be a disposal even if no cash hits a bank account.
Actions That Are Usually Not Disposals (But Still Matter)
Many people panic about wallet transfers. The IRS FAQ says that transferring digital assets from one wallet, address, or account you own to another you own is generally a non-taxable event. The same FAQ adds an important caveat: the transfer is non-taxable except to the extent digital assets are used or withheld to pay for transaction services.
So, the transfer itself usually does not go on the 8949 form, but the records still matter, because later sales need the original cost basis and acquisition date. Put simply, transfers are the glue that keeps lots connected.
Which Box to Check on the 8949 Form?
At the top of each part, you check one box that describes the kind of documentation you have.
The IRS instructions say:
- Box C (Part I) is for short-term transactions when you cannot check A or B because you did not receive a Form 1099-B (or substitute statement).
- Box F (Part II) is for long-term transactions when you cannot check D or E because you did not receive a Form 1099-B (or substitute statement).
Many crypto users end up using codes C and F on Form 8949 because their activity happens across multiple wallets and platforms that do not consistently report cost basis, unlike a traditional stock broker.
Form 1099-DA shows where crypto reporting is heading, but it does not replace Form 8949. For 2025 sales, brokers may report cost basis on Form 1099-DA, but they are not required to do so. Because of this, many taxpayers will still need their own complete records to prepare an accurate Form 8949 form.
If you receive a Form 1099-DA, Form 8949 includes additional box options that may apply depending on whether the cost basis was reported.
A Simple Tour of The Form 8949 Form Columns
The IRS instructions outline how to complete the columns, how to reconcile information returns, and how to use codes and adjustments when something needs correcting.
Here is what those columns mean in crypto terms:
- Column (a), Description of property: what you disposed of, such as “0.50 BTC” or “1,200 MATIC.”
- Column (b), Date acquired: when you got the lot you sold.
- Column (c), Date sold or disposed: when you sold, swapped, or spent it.
- Column (d), Proceeds: what you received, usually in USD value at the time.
- Column (e), Cost or other basis: what you paid for that lot, plus or minus allowed adjustments.
- Column (f), Code(s): the IRS instruction codes that explain why an adjustment exists.
- Column (g), Adjustment amount: the numeric correction linked to the code.
- Column (h), Gain or loss: proceeds minus basis, after adjustments.
Short-Term Vs Long-Term in the 8949 Form
The IRS treats digital assets as property, and the usual rules for short-term and long-term gains and losses apply. The 8949 form reflects that with two parts:
- Part I: short-term transactions.
- Part II: long-term transactions.
Holding period depends on when you acquired the asset you disposed of. If acquisition dates are missing, trades can land in the wrong part. That is one of the biggest reasons people use a tool instead of a spreadsheet.
How 1099-DA Ties into the 8949 Form In 2025 And 2026?
IRS indicates that reporting on broker transactions of digital assets is mandated on Form 1099-DA in 2025 on and after January 1, 2025.
It also specifies the phase-in: brokers are required to initially report gross proceeds, followed by a report on basis on some transactions occurring on or after January 1, 2026.
Taxpayers balance those amounts with their entire ledger on 8949 form. Form 1099-DA is specifically mentioned in the instructions of the Form 8949 as a part of this reconciliation purpose.
A practical way to handle this is:
- Match broker proceeds to your disposal proceeds for that platform
- Rebuild missing basis for assets moved in from elsewhere
- Use codes and adjustments only when you can explain the difference
Reuters reported that Treasury reviewed over 44,000 public comments while shaping the rules, which fits the reality. Crypto reporting has a lot of edge cases.
High-Volume Crypto Traders: Two IRS Options That Can Save Time
When you have hundreds or thousands of disposals to fill in, the 8949 form may seem like it has no end. The quick calculator helps in estimating the gains that might be achieved within the year. The HR and block tax calculator can allow you to have some idea of how a sale or swap would affect your total tax bill. They are useful in planning, but not in generating the information that is required on the 8949 form by the IRS. The IRS instructions present two alternatives that you should be familiar with before you export anything.
Exception 1: Some broker-reported trades can be summarized on Schedule D
Forms 8949 are not necessary where some transactions qualify to be aggregated on Schedule D line 1a (short-term) or 8a (long-term). The IRS is restricting this option to situations in which you received a form 1099-B on which basis was reported, no adjustments are reported, and you are not required to adjust basis or gain or loss.
Exception 2: Attach a statement instead of listing every trade on the form
The IRS similarly permits an attached statement of a comparable format as Form 8949, so long as it provides the same information: description, dates, proceeds, basis, adjustment codes and amounts, and gain or loss. It prohibits substituting that detail with a note that details are available upon request, or with summary totals.
Crypto filers frequently lean on Exception 2 since wallet activity lies outside of broker reports, yet it still requires line-by-line detail.
This is where crypto tax reporting software can be useful. CRPTM produces IRS-ready reports such as Form 8949 and Schedule D summaries.
A CRPTM-Centered Workflow for Building a Clean 8949 Form
CRPTM is a crypto tax calculator and portfolio tracker that can consolidate transactions across exchanges and generate crypto tax reports. It also states support for 180+ exchanges.
Here is a reliable workflow that maps to what the IRS wants:
1) Import And Consolidate Everything
Crypto history breaks when you only upload part of it. Consolidation helps connect purchases, transfers, and disposals so basis can be calculated. CRPTM says it helps connect multiple exchanges and centralize transactions for crypto tax reporting.
2) Review The “Transfer Vs Trade” Logic
A transfer between wallets you control is not a taxable disposal, but it can look like one if data is incomplete. Take a moment to scan for misclassified transfers. This single step prevents a lot of phantom gains.
3) Fix Missing Cost Basis While the Trail Is Still Fresh
If CRPTM flags an unknown basis, solve it now, not in April panic mode. Unknown basis often traces back to:
- Deposits from an external wallet.
- Older buys on a platform you forgot.
- Token migrations and chain swaps.
Pick one identification method and stick with it. For specific identification, the IRS expects identification and records by the date and time of the transaction. If you cannot meet that bar, use the default earliest rule.
4) Generate A 8949 Form-Style Output and Check the Columns
CRPTM describes one-click report generation and mentions TurboTax/TaxAct report compatibility. Your goal is simple: an export that includes description, dates, proceeds, basis, and gain or loss, split into short-term and long-term.
5) Reconcile Any Statements You Received (Including 1099-DA)
If you received a broker statement, compare proceeds and dates. The IRS draft guidance on 1099-DA highlights the shift toward standardized digital asset reporting. Matching is easier when your report is complete.
The Most Common 8949 Form Mistakes (And How to Avoid Them)
It is easy to be close and still be wrong. These are the errors that cause the most crypto tax headaches.
Mistake 1: Ignoring Transfers Because They Are “Not Taxable”
Transfers between wallets you own are generally not taxable, but missing them can break basis chains and inflate gains. The IRS FAQ is clear that the transfer is non-taxable, but the fees caveat means the details still matter.
Mistake 2: Forgetting That Fees Paid in Crypto Can Be a Disposal
If digital assets are used or withheld to pay for transaction services, that portion can be taxable. This matters on chains where fees are paid in the native coin.
Mistake 3: Mixing Income Events with Capital Events
Form 8949 is for capital assets. Some crypto is received as income (for example, compensation), and then later disposed of as property. Notice 2014-21 and the IRS digital-assets guidance describe how property principles apply and remind taxpayers they must report digital-asset transactions.
Mistake 4: Putting The Right Numbers in The Wrong Bucket
Short-term and long-term are not cosmetic categories. The Schedule D instructions describe the general one-year split. If acquisition dates are wrong, you can misclassify gains.
Mistake 5: Totals Do Not Tie from Form 8949 To Schedule D
The IRS explains that Form 8949 subtotals carry to Schedule D. If your totals do not tie out, it often means a duplicate import, a missing account, or a category mismatch.
Conclusion
The 8949 form is not complicated because the IRS loves paperwork. It is complicated because crypto history is scattered. Once the history is complete and connected, the form becomes a structured list of what you sold, when, and at what gain or loss.
If you want a filing-ready form 8949 form without living in spreadsheets, CRPTM is built around that outcome, with Form 8949 and Schedule D summaries meant for direct filing or accountant handoff.
FAQs
Does a taxpayer need one line per crypto trade?
For most crypto disposals, yes. The point of the 8949 form is to list each sale or exchange of a capital asset. That is exactly how the IRS describes the form’s purpose.
Can a taxpayer skip Form 8949 and only file Schedule D?
The IRS guidance frames Form 8949 as the reconciliation layer, and the form itself has separate categories based on what was reported to the IRS and whether basis was reported. In practice, if you have multiple sources and any adjustments, the 8949 form is usually the safer path.
If the taxpayer only transferred coins between wallets, do they still report anything?
A pure transfer between wallets you own is generally non-taxable, and you usually do not list it on the 8949 form, but the fee caveat means you still track details and keep records.
What does CRPTM actually generate for filing?
CRPTM states it generates IRS-ready reports, including Form 8949 and Schedule D summaries, and its tax reporting pages describe generating detailed tax reports from a dashboard. That is what you want when the goal is correct crypto tax reporting, not guesswork.
