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Which Crypto Units Did You Sell? Lot ID and the 1099-DA

Short answer: The 2026 instructions for Form 1099-DA say that when a customer bought units on different dates or at different prices and sells less than the whole position, the broker reports the sale "according to the customer's adequate and timely identification." If no identification is given at or before the sale, the broker generally must first report the sale of the earliest units purchased. The broker may consider customer-provided acquisition information.

What this affects

Which lot is sold decides the cost basis on your 1099-DA (box 1g for covered assets) and the dates in boxes 1d and 1e, so it can change short-term vs long-term treatment. The IRS Digital assets page says to calculate gain or loss you need the type, date and time, units, fair market value and basis, and points to the FAQs for how to identify units sold.

What the instructions say

• Box 1d is the acquisition date; box 8 is checked if the broker relied on customer-provided acquisition information to identify which units were sold.
• Reporting of basis is required for covered assets; noncovered assets (acquired before 2026, transferred in, or not held in broker custody) may have no basis reported (see covered vs noncovered).

Transition guidance the IRS lists (titles only)

• Revenue Procedure 2024-28: lets taxpayers allocate unused basis to the digital asset units in each wallet or account as of January 1, 2025.
• Notice 2025-07: "Temporary relief for eligible taxpayers to rely on alternative methods for making an adequate identification regarding units of a digital asset held in the custody of a broker." We did not read these documents, so we do not describe their conditions.

Illustration (made-up)

You bought 1 unit in 2024 for $10,000 and 1 unit in 2026 for $30,000, then sell 1 unit for $35,000 without giving an identification. Under the default the broker reports the earliest unit: basis $10,000 and gain $25,000 in this example (the 2024 unit is noncovered, so the broker may not report basis). If you had made an adequate, timely identification of the 2026 unit, the broker would follow it: basis $30,000, gain $5,000. Whether your identification was adequate and timely is a question for your broker's rules and a tax professional.

Practical checklist

• Ask your platform how it lets you pick lots and by when.
• Keep a record of your own lot choices and wallet-by-wallet purchase history (year-end records).
• After moving assets between platforms, check basis (transfers).

FAQ

Can I change the lot after the sale? The instructions say identification must be adequate and timely (at or before the sale); we do not describe later changes.

Does the broker's choice bind my return? Not covered by the pages we read; see a tax professional.

What we could not verify

• The Treasury regulation text and the FAQs on identification methods (not read).
• Rev. Proc. 2024-28 and Notice 2025-07 conditions (titles only).
• How each platform implements lot selection.

Sources (official)

• IRS, Instructions for Form 1099-DA (2026) — https://www.irs.gov/instructions/i1099da (PDF read in full 17 October 2026)
• IRS, Digital assets — https://www.irs.gov/filing/digital-assets (read in full 17 October 2026)

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Not tax advice. Examples use made-up figures. Nothing here has been reviewed by a tax professional. We may earn commissions from affiliate links where marked; see the disclosure.