Form 1099-DA's first season leaves crypto investors to supply their own cost basis by Oct. 15

For anyone who paid in April, the penalty is the smaller problem. IRS guidance caps monthly late-filing penalties at 25% of unpaid tax ^[10], and the base is whatever went unpaid after the April 15 payment date ^[2]. Take a filer who estimated and paid the full 2025 bill by April 15 and then misses Oct. 15. That filer is applying 25% to zero ^[2]. A filer who paid nothing has six months of interest and possible payment penalties on the balance already, and an Oct. 15 return does not remove them ^[3].

The bigger dollar exposure is in the form itself. This is the first federal filing season in which many custodial brokers have reported digital-asset sales on Form 1099-DA ^[1]. For most 2025 transactions they were not yet required to include cost basis ^[6]. In an example from crypto.news, a token bought for $8,000 and sold for $10,000 shows $10,000 of proceeds against a gain that generally starts from $2,000 ^[7]. A return that treats the proceeds line as the gain overstates it by $8,000, the entire purchase price, and reports five times the real profit ^[1].

This year the brokers report the sale price and stop there. That price goes to both the IRS and the customer ^[5]. The IRS has warned that most 2025 forms leave the taxpayer to work out the purchase price ^[6]. The agency gets more transaction data from the form ^[4], and the holder does the work, and pays for it, of rebuilding basis ^[6].

A late form leaves that work in place. Receiving a 1099 is not a condition of reporting, and the IRS digital-asset FAQ requires income, gains and losses to be reported without one ^[9]. So the 21% of surveyed extension filers still waiting on a platform in August ^[8] are filing on their own numbers. Those numbers cover more than cash sales: token-for-token swaps and crypto spent on goods both count ^[11]. Every 2025 Form 1040 asks a yes-or-no digital-asset question regardless ^[12]. Taxpayers in qualifying disaster areas and some citizens living abroad work to different dates ^[13].

The deadline splits extension filers roughly three ways. Filers who paid in April and hold their own purchase records face a paperwork date. Underpayers carry accrued interest whatever they file, plus the 25% ceiling if they miss the date ^{[3] [10]}. The group still waiting on platform data is filing on a reconstruction ^[8].

I think the basis gap costs a filer who paid in April more than any penalty could. The penalty base is limited to what went unpaid, while a missing basis adds the full purchase price to taxable gain ^[1]. The counter-case is a filer who skipped the April estimate and keeps adding monthly charges ^[10]. The survey does not say how many extension filers owed money in April. If most did, the penalty is the bigger number for this group and the view above is wrong.