How TradeLog Handles Digital Assets (Including Cryptocurrency)

What are Digital Assets?

The IRS uses the term digital assets for digital representations of value recorded on a cryptographically secured distributed ledger or similar technology. Digital assets include cryptocurrencies such as Bitcoin and Ethereum, as well as certain other digital assets.

TradeLog uses Digital Assets as the account and tax-reporting classification for supported digital asset transactions.

Tax Reporting of Digital Assets in TradeLog

Do You Need TradeLog for Digital Asset Tax Reporting?

Many taxpayers can use the information provided by their broker or exchange on Form 1099-DA to complete their tax reporting without using TradeLog.

If your Form 1099-DA includes complete and accurate cost basis information, and you have no additional transactions or adjustments to account for, using that information directly may be the simplest option.

TradeLog may be useful if you need to calculate gains and losses from transaction history, determine missing cost basis, or consolidate trading activity from multiple accounts.

Important: Form 1099-DA does not always include cost basis information. You are responsible for ensuring that all taxable digital asset transactions are accurately reported, including transactions not reported on Form 1099-DA.

Beginning with the 2025 tax year, brokers subject to digital asset reporting requirements may report sales and other dispositions to you and the IRS on Form 1099-DA, Digital Asset Proceeds From Broker Transactions.

The IRS also added separate digital asset reporting categories to Form 8949 beginning with tax year 2025:

• G / J – Form 1099-DA transactions with cost basis reported to the IRS
• H / K – Form 1099-DA transactions with cost basis not reported to the IRS
• I / L – Digital asset transactions not reported on Form 1099-DA

G, H, and I are used for short-term transactions. J, K, and L are used for long-term transactions.

For 2025 transactions, brokers are required to report applicable digital asset proceeds on Form 1099-DA, but they are generally not required to report cost basis. Mandatory basis reporting for covered digital assets begins with sales occurring in 2026.

TradeLog's Form 8949 for Digital Assets report calculates capital gains and losses and assigns transactions to the appropriate Form 8949 reporting category based on the information entered in TradeLog.

Tax Years 2024 and Earlier

For tax years 2024 and earlier, TradeLog reports digital asset transactions and resulting capital gains or losses on Form 8949 using:

• Category C for short-term transactions
• Category F for long-term transactions

These categories were used because digital asset transactions did not yet have their own Form 8949 reporting categories.

TradeLog does not apply wash sale adjustments to transactions identified as Digital Assets using the DCY-1 Type/Mult.

Reconciling Digital Asset Transactions

TradeLog does not currently support reconciliation of Digital Asset transactions against IRS Form 1099-DA.

When completing the reconciliation process for an account containing Digital Asset transactions, select No 1099-B to bypass the reconciliation step.

Click here for more information about reconciling accounts in TradeLog.

Setting Up Digital Asset Account(s) in TradeLog

Set up a separate Account Tab in TradeLog for each exchange, broker, trading platform, or other provider used for your digital asset transactions.

Click here for instructions to Add Accounts in TradeLog.

The Account Type should generally be set to Regular Cash Basis for Digital Asset accounts.

How are Digital Asset trades identified in TradeLog?

TradeLog uses a Type/Mult of DCY-1 to identify Digital Asset trade history.

The Ticker field should contain a consistent symbol for each digital asset. For example, BTC may be used for Bitcoin and ETH for Ethereum.

Click here to refer to one list of standard cryptocurrency symbols.

Symbols may vary depending on the exchange or user preference. However, it is important to consistently use the same symbol so TradeLog can properly match transactions involving the same digital asset.

Other trade record fields should be entered as follows:

Date – The date the transaction occurred.

Time – The time the transaction occurred.

O/C – Use O for an opening transaction in which the digital asset was acquired. Use C for a closing transaction in which the digital asset was sold, exchanged, or otherwise disposed of.

L/S – Digital Asset transactions will typically use L for a long position. S is used for a short-sale transaction in which the digital asset is sold before being acquired.

Ticker – The symbol used to identify the digital asset. See the note above regarding consistent symbols.

Sh/Contr – The number of units involved in the transaction. For example, one Bitcoin would be entered as 1. A fractional amount should be entered as a decimal. TradeLog currently supports a maximum of five decimal places, so quantities with greater precision must be rounded.

Price – The value of one unit of the digital asset at the time of the transaction, expressed in the base currency used for tax reporting, typically U.S. dollars (USD).

Type/Mult – Use DCY-1 to identify the transaction as a Digital Asset.

Comm – Enter transaction fees associated with the individual transaction as a positive amount. TradeLog automatically adds or subtracts the fee as appropriate based on whether the transaction is an acquisition or disposition.

Amount – The total value of the transaction in the account's base currency, typically USD. TradeLog calculates the amount using the quantity, price, and commission entered.

Profit/Loss – Calculated automatically by TradeLog when transactions are matched.

Notes – Use this field for additional information about the transaction. For example, you may wish to identify a transaction involving the exchange of a digital asset for goods, services, or another digital asset.

Click here to learn more about manually entering trades into TradeLog.