1099-DA & CARF Tax Clarity Is Here. Now What?

2025 is shaping up to be a massive turning point for anyone in the onchain economy. 

Between the finalized 1099-DA rules from the IRS, the rollout of CARF on a global scale, and the repeal of SAB 121, there has never been more tax reporting guidance available. 

That’s why we teamed up with our partners at S&P Global to break it all down below.

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1099-DA Is Here. And That’s Just the Beginning

Let’s start with what’s changing in the U.S. For the first time, the IRS is requiring digital asset brokers to submit 1099-DA forms for reportable transactions. That means any custodial broker—a platform or institution that holds assets on behalf of customers—needs to be collecting and storing data now in preparation for reporting in 2026.

Key points:

• Only custodial brokers are in-scope for now. DeFi platforms are out (after a bipartisan repeal), but don’t get too comfortable if you operate outside of the U.S. Global frameworks like CARF do include DeFi.
  
• IRS expects to receive billions of 1099-DA forms. No joke. We’re staring down an incredibly complex effort from the U.S. federal agency.
  
• Wallet-level inventory is critical. You can only report cost basis and gains if you’re tracking the right assets in the right wallets. Bitwave is already helping institutions align wallet data with IRS-ready reporting formats.
  
  

CARF Is Coming: Global Rules, Global Complexity

While U.S. reporting is focused on 1099-DA forms, the OECD’s Crypto-Asset Reporting Framework (CARF) is rolling out globally, with over 60 countries signed on to exchange data by 2027.

CARF differs from the IRS model in key ways:

• DeFi is in-scope under CARF, with more expansive definitions of what counts as a broker (or a “CAASP”).
  
• Gross proceeds only. Unlike the U.S., CARF doesn’t require cost basis reporting (for now).
  
• XML-based reporting schema. Institutions will need to report asset-level inflows and outflows with serious granularity.
  
  

Bonus challenge: CARF comes with complex nexus rules. If your company has legal entities in different countries (or if you offer services to users across borders), you’ll need to assess where, and how, to report.

What Institutions Should Do Now

Whether you’re gearing up for 1099-DA or prepping for CARF, the best move is to treat 2025 as your dress rehearsal. Don’t wait for year-end.

Here’s what our CEO, Pat White, recommends:

1. Start data collection now. You’ll need a clean trail from acquisition to disposition.
2. Run a test in July. Treat it like your Q2 compliance dry run.
3. Do a full dress rehearsal in November. Bring in your auditors or advisory partners to review.
4. Be ready to file in January 2026. Avoid surprises with the deadline.

Bitwave can help you get there with wallet-level tracking, gain/loss calculations, and seamless integration with S&P Global’s tax reporting infrastructure. 

The result? A complete, audit-ready reporting stack–from on-chain activity to IRS compliance.

Regulatory Wins: SAB 122 Levels the Playing Field

Let’s not forget a huge recent shift: the SEC recently repealed SAB 121 and introduced SAB 122, removing the requirement for banks to carry customer digital assets on their balance sheets. 

This opens the door for more traditional financial institutions to enter the crypto space.

With more clarity from the IRS, more participation from banks, and better tooling than ever, the digital asset industry is truly maturing. And fast.

The right compliance foundation today is how you win tomorrow.

Conclusion

Tax clarity is here, but execution is everything. 

Whether you’re sorting through wallet-level inventory or prepping for cross-border compliance, Bitwave and S&P Global are here to make it easier, smarter, and scalable.

Want to watch the full webinar from Bitwave and S&P?  Check out the session on Bitwave University, our NASBA-licensed CPE platform. 

Ready to get your reporting stack in place for 2026? Reach out to the Bitwave team. 

We're here to accelerate your onchain finance journey and help digital assets work for you.

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