The U.S. cryptocurrency tax rules see a change in 2026, with outlets reporting the following changes.
Infrastructure, Investment and Jobs Act of 2021
The Infrastructure, Investment and Jobs Act changed the definition of a broker to include any entity that facilitates the transfer of digital assets on behalf of other people. Based on this new definition, centralized crypto exchange must report to the Internal Revenue Service (IRS).
IRS Broker Definition Changes: Reporting to Bodies
Exchanges like Binance and Magic Eden U.S. are affected by this policy; profits and losses, transactions made, and overall financial documentation will be reported to relevant bodies for auditing. The 1099-DA reporting, meanwhile, requires brokers and users to file reports on their gains, losses and transactions as taxable income.
1099-DA Reporting
All transactions within these platforms must be recorded and reported to authorities; gone are the days of anonymous transactions—this scrutiny is for proper security and record-keeping of trades through the 1099-DA report. NFT marketplaces are also classified as brokers under new regulations. “They must issue 1099-DA reports for NFT sales, including secondary market sales, and creator royalties.”
What Falls under Taxation?
Although there are certain gray areas for Decentralized Autonomous Organizations (DAOs), self-custody wallets, automated market makers (AMMs), and other DeFi platforms, users are still expected to self-report their own trades and transactions. Any trades above 10,000 US Dollars require form 8300 to be filed.
Crypto is Considered as Assets and Property
The IRS currently treats cryptocurrency as assets and property—and thus these are taxed accordingly. Profits are thus covered as capital gains tax, much like how when one profits from the sale of a house, or stock options. According to the IRS “you are taxed when you sell, trade, or spend it for a profit, and when you earn new tokens through mining, staking, or airdrops; however, transfers between your own wallets are not taxable events, as no gain or loss is realized.” That said, conversion of cryptocurrency to fiat currency such as US Dollars are taxable.
Other Transactions Covered as Taxable Income
Other tax rules cover receive salary using cryptocurrency, rewards from mining, staking rewards, airdrops, hard forks, and NFTs.
