The IRS rolled out Form 1099-DA, and Clinton Donnelly says the first version is already creating serious problems for crypto investors and tax preparers.

In this episode, Clinton explains why the 1099-DA collects the data the IRS wants, but fails to help taxpayers file correctly. The information may be there, but it is hidden, buried, and difficult to enter properly on a tax return.

He also explains why confusion around the 1099-DA could lead to a high error rate, mismatched IRS records, and a wave of CP2000 notices for crypto investors this fall.

In this episode:

• Why the 1099-DA is harder to use than a normal 1099

• Why some tax preparers may refuse crypto returns

• Why Clinton expects a roughly 75 percent error rate

• How a missed or mismatched 1099 can turn into a CP2000 notice

• Why CP2000 notices may be based on wrong IRS assumptions

• Why taxpayers should respond and push back on numbers they do not believe

Resources:

TaxShield audit defense:
https://www.cryptotaxaudit.com/taxshield?afmc=spotify

Crypto gain calculation:
https://www.cryptotaxaudit.com/crypto-gain-calculation?afmc=spotify

Book a consultation:
https://www.cryptotaxaudit.com/crypto-tax-consultation?afmc=spotify

About Clinton Donnelly:
Clinton Donnelly is an Enrolled Agent and founder of CryptoTaxAudit, known as the Crypto Tax Fixer. He helps crypto investors understand IRS notices, crypto tax reporting problems, and audit defense.

Disclaimer:
This episode is for educational and informational purposes only and does not constitute legal, tax, or financial advice. Tax laws and IRS procedures can change, and every situation is unique. Consult a qualified tax professional before taking action.

The IRS says tax season was a success, but crypto taxpayers may be facing a very different reality.

In this episode, Clinton Donnelly explains why the new IRS Form 1099-DA may give the IRS more crypto transaction data while still leaving taxpayers and tax preparers unsure what numbers actually belong on the tax return.

Clinton breaks down how IRS automation, CP2000 under-reporting letters, missing cost basis, crypto-to-crypto taxable trades, and confusing 1099-DA formats could create problems for taxpayers who are trying to file correctly.

He also explains why simply receiving more data does not mean taxpayers have more clarity.

Topics covered:

• IRS automation and staffing reductions
• CP2000 under-reporting notices
• Why the 1099-DA may not solve crypto tax confusion
• Why crypto-to-crypto trades are taxable
• Why taxpayers may struggle to know what to report
• Why clearer 1099-DA summaries are needed

Referenced sources:

Nextgov/FCW: IRS workforce reduction and technology plan
https://www.nextgov.com/modernization/2026/04/irs-wants-shrink-its-workforce-nearly-4000-and-use-technology-make-difference/412659/

CoinDesk: Crypto holders confused about new IRS tax rules
https://www.coindesk.com/business/2026/02/18/american-crypto-holders-are-scared-and-confused-about-this-year-s-new-irs-tax-rules

CoinTracker / Coinbase: 2026 Crypto Tax Readiness Report
https://www.cointracker.io/2026-crypto-tax-report/public/crypto-tax-report-2026.pdf

Official IRS Form 1099-DA page
https://www.irs.gov/forms-pubs/about-form-1099-da

Need help understanding your crypto tax exposure?

Book a consultation with CryptoTaxAudit:
https://www.cryptotaxaudit.com/crypto-tax-consultation

DISCLAIMER

This episode is for educational and informational purposes only and does not constitute legal, tax, or financial advice. Tax laws and IRS procedures can change, and every situation is unique. You should consult with a qualified tax professional before taking any action based on this content. Listening to this episode does not create a client relationship with Clinton Donnelly or CryptoTaxAudit.

Clinton Donnelly recently attended the CERCA IRS conference, where IRS electronic tax reporting, taxpayer communication, automation, and modernization were discussed with IRS leadership.

One major takeaway stood out: CryptoTaxAudit was the only crypto-related firm attending the conference.

That matters because the 1099-DA is becoming one of the most important reporting forms crypto taxpayers will face. In prior years, crypto gain calculation companies and other reporting firms were involved in these conversations. In 2026, they were no longer present.

In this episode, Clinton explains why the 1099-DA rollout created confusion for crypto taxpayers, why some crypto investors may still not be reporting cryptocurrency income, and why he is gathering feedback for a possible crypto tax amnesty proposal.

He also shares what he learned about IRS hiring, Schedule 1A, AI use inside the IRS, COBOL modernization, and how technology is changing tax administration.

Topics covered:
• What happened at the CERCA IRS conference
• Why CryptoTaxAudit was the only crypto firm present
• Why the 1099-DA matters for crypto taxpayers
• Why crypto reporting is still confusing for many traders
• The case for a crypto tax amnesty discussion
• IRS hiring plans for customer service
• Schedule 1A and new tax incentives
• How the IRS is using AI and COBOL modernization
• What IRS automation could mean for taxpayers

Book a crypto tax consultation:
https://www.cryptotaxaudit.com/crypto-tax-consultation

Disclaimer:
This episode is for educational purposes only and is not tax, legal, accounting, or financial advice. Every taxpayer’s situation is different. Speak with a qualified tax professional before making tax decisions.

Should the IRS offer a crypto tax amnesty program for traders who want to become compliant?

In this episode, Clinton Donnelly asks crypto traders, investors, tax professionals, and anyone affected by crypto reporting problems to share constructive feedback.

CryptoTaxAudit is preparing a proposal or recommendation for cryptocurrency tax amnesty. The goal is to gather real-world comments about what has kept people from reporting all their crypto income, what makes crypto tax reporting difficult, and what the IRS could do beyond Form 1099-DA to help taxpayers come in from the cold.

This is not about ignoring past tax problems. It is about asking whether the IRS should create a practical path for crypto traders who want to fix past reporting issues and stay compliant moving forward.

Key questions Clinton wants answered:

What should crypto tax amnesty include?

What has made crypto tax reporting difficult?

What should the IRS do beyond Form 1099-DA?

What would actually help crypto traders report correctly?

Share your thoughts in the comments or reach out to CryptoTaxAudit.

Learn more or request help with crypto tax compliance:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Disclaimer:

This episode is for educational and informational purposes only and does not constitute legal, tax, or financial advice.

Tax laws and IRS procedures can change, and every situation is unique.

You should consult with a qualified tax professional before taking any action based on this content.

Listening to this episode does not create a client relationship with Clinton Donnelly or CryptoTaxAudit.

For personalized guidance, visit:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Are you trading on Kalshi, Polymarket, or other prediction markets?

In this episode, Clinton Donnelly explains why prediction market taxes can be confusing, especially when activity may be treated differently depending on whether it looks like gambling or capital asset activity.

One of the biggest issues discussed is the 90% loss rule. In some cases, a trader could lose money overall and still have taxable income because gambling losses may be limited and treated differently from capital losses.

Clinton covers:

• Why prediction market taxes are still a gray area

• Why the IRS has not issued clear guidance on this specific issue

• The difference between event-driven prediction markets and financial market predictions

• Why sports, elections, and outcome-based markets may look more like gambling or wagering

• How gambling loss limits can create a tax trap

• What the standard deduction trap means

• Why financial-market-based prediction activity may be closer to capital gains treatment

• Why 1099 reporting from regulated platforms may matter

Prediction markets are growing fast, but the tax treatment is not always simple. If you are active on Kalshi, Polymarket, or similar platforms, this is an issue worth understanding before tax season.

For help with complex crypto tax reporting or IRS crypto tax issues, visit:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Disclaimer: This episode is for educational purposes only and is not tax, legal, accounting, or investment advice. Prediction market tax treatment may depend on your specific facts, the type of market traded, the platform used, and current IRS guidance. Consult a qualified tax professional before making tax decisions.

Your 1099-DA may make it look like you made far more money from crypto than you actually did.

In this episode, Clinton Donnelly explains why Form 1099-DA can report gross proceeds without showing your true cost basis, and why that can create serious confusion for crypto taxpayers.

The key issue is simple: proceeds are not profit.

A crypto trader could have millions of dollars in reported proceeds, but much lower actual taxable gain once cost basis is properly calculated. If the IRS receives a 1099-DA and your return does not account for it, that mismatch may lead to an IRS notice.

Clinton breaks down:

• Why 1099-DA proceeds can look much higher than real profit

• Why missing cost basis creates crypto tax reporting problems

• Why Coinbase-style 1099-DA forms may be hard to read

• Why some accountants may struggle with complex crypto returns

• How wallet transfers can distort holding periods

• Why long-term crypto may appear short-term on the form

• Why ignoring a 1099-DA could create IRS problems

If you received a 1099-DA, traded crypto through Coinbase or another exchange, or moved crypto between wallets before selling, this episode explains what you need to understand before filing.

Need help with crypto tax reporting or IRS crypto notices?

Book a consultation with CryptoTaxAudit:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Learn more:

https://www.cryptotaxaudit.com

High-frequency crypto traders may receive 1099-DA forms with large reported numbers. The real issue is whether their tax return clearly explains those numbers.

In this episode, Clinton Donnelly explains the two main strategies crypto traders may consider as 1099-DA reporting becomes more important.

One option is to trade on one centralized platform so that one exchange may be able to report cost basis, sales price, and gain or loss on one 1099 form. Clinton compares this to how traditional brokerages like Merrill Lynch and Fidelity report stock activity.

The other option is to keep assets in private wallets and decentralized platforms, then only use centralized exchanges when cashing out. But even then, centralized exchange activity may still be reported on a 1099-DA.

Clinton also explains why a 1099-DA mismatch can create IRS audit risk. If the IRS sees numbers that do not line up with a tax return, they may ask for transaction history, exchange records, wallet activity, and DeFi activity.

In this episode:

• Why high-frequency crypto traders may receive large 1099-DA numbers

• Why one exchange can simplify crypto tax reporting

• Why private wallets can create more reporting complexity

• Why cash-out activity may still be reported

• How a 1099-DA mismatch can lead to IRS questions

• Why professional crypto gain calculation matters

• How CryptoTaxAudit helps traders prepare defensively

Clinton Donnelly is the founder of CryptoTaxAudit, known as the Crypto Tax Fixer, and a leading expert in IRS representation, crypto tax compliance, and audit defense.

Need help with 1099-DA reporting, crypto gain calculation, or IRS crypto audit risk?

Book a crypto tax consultation:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Learn about Tax Shield:

https://www.cryptotaxaudit.com/taxshield

Crypto gain calculation support:

https://www.cryptotaxaudit.com/crypto-gain-calculation

Some taxpayers may need to act before July 10, 2026, to preserve refund or abatement claims for certain COVID-era IRS penalties and interest.

In this episode, Clinton Donnelly explains why the Kwong ruling may matter for taxpayers who were assessed IRS penalties, fees, or interest during the COVID-era deadline period.

Clinton breaks down:

• Why COVID-era IRS deadline relief matters
• How some taxpayers may have been charged penalties during the affected period
• Why Form 843 may be used to request a refund or abatement
• Why certified mail and proof of delivery matter
• Why relief may not happen automatically
• Why timing matters before the July 10, 2026 deadline

This episode is especially relevant for taxpayers, tax professionals, business owners, crypto investors, and anyone who may have faced IRS penalties or interest during the COVID period.

✅ Book a Kwong ruling review:
https://calendly.com/crypto-tax-audit/kwong-ruling?month=2026-05

📖 Read the full CryptoTaxAudit breakdown:
https://www.cryptotaxaudit.com/blog/kwong-penalty-interest-abatement-covid-tax-deadlines

💼 CryptoTaxAudit consultation:
https://www.cryptotaxaudit.com/crypto-tax-consultation

This episode is for educational and informational purposes only and does not constitute legal, tax, or financial advice.

Tax laws and IRS procedures can change, and every situation is unique. You should consult with a qualified tax professional before taking any action based on this content.

Listening to this episode does not create a client relationship with Clinton Donnelly or CryptoTaxAudit.

LinksDisclaimer

Is the IRS operating without a real Commissioner, and could that create problems for Tax Court cases, IRS appeals, and crypto tax enforcement?

In this episode, Clinton Donnelly speaks with Anthony Parent of IRSMedic about the IRS Commissioner problem, Tax Court authority, IRS delegation orders, and what may happen when enforcement continues without clear leadership at the top.

Anthony explains why he filed a motion to vacate in U.S. Tax Court, why he believes the absence of a Commissioner of Internal Revenue may create structural problems, and how this could affect certain IRS collection and Tax Court matters.

The conversation also covers Form 1099-DA and the crypto tax reporting problems expected in 2026. Clinton and Anthony explain why 1099-DA may confuse taxpayers, why gross proceeds do not equal taxable income, and why missing cost basis could trigger IRS mismatch issues or CP2000-style notices.

They also discuss AI in tax law, why tools like TaxGPT can produce confident but wrong answers, and why tax professionals who use AI lazily may create serious problems for their clients.

Anthony Parent is the founder of IRSMedic and helps taxpayers with complex IRS, offshore disclosure, international tax, and tax controversy matters.

Follow Anthony Parent and IRSMedic:

Website: https://irsmedic.com/

YouTube: https://www.youtube.com/@irsmedic

X / Twitter: https://x.com/IRS_MEDIC

Need help with crypto tax reporting, Form 1099-DA, IRS letters, or audit risk?

Book a crypto tax consultation:

https://www.cryptotaxaudit.com/crypto-tax-consultation

Get 1099-DA and crypto tax help:

https://www.cryptotaxaudit.com/tax-crypto-pricing

Learn more about TaxShield IRS monitoring:

https://www.cryptotaxaudit.com/taxshield

Disclaimer:

This episode is for educational and informational purposes only and does not constitute legal, tax, or financial advice.

Tax laws and IRS procedures can change, and every situation is unique.

You should consult with a qualified tax professional before taking any action based on this content.

Listening to this episode does not create a client relationship with Clinton Donnelly, Anthony Parent, IRSMedic, or CryptoTaxAudit.

Miss a 1099 and the IRS may assume you underreported income.

A CP2000 notice is triggered when the IRS compares the 1099s they received with what was included on your tax return and finds a mismatch. They calculate additional tax and send you a notice to review or challenge.

Clinton Donnelly explains:

• What a CP2000 notice is
• Why missing 1099s trigger it
• Why the IRS calculations are often wrong
• How it differs from a full audit
• What to do if you receive one

This is not an audit, but it does require a response.

Review your situation before it escalates:
https://www.cryptotaxaudit.com/crypto-tax-consultation

Disclaimer

This content is for educational and informational purposes only and does not constitute legal, tax, or financial advice.
Tax laws and IRS procedures can change, and every situation is unique.
You should consult with a qualified tax professional before taking any action.
Listening does not create a client relationship with Clinton Donnelly or CryptoTaxAudit.