Case Study
Multiple 1099-DAs with Legacy Basis, Unreported DEX Activity, and Rev. Proc. 2024-28 Realignment
The Problem
Client received 1099-DA forms from multiple exchanges reporting gross proceeds on assets acquired years before 2025, where brokers had no cost basis on file. A significant portion of trading activity occurred on DEX platforms that issued no 1099-DA at all, creating a reporting gap the client had not accounted for. The client's prior cost basis records had been tracked using a universal pooling approach no longer aligned with Rev. Proc. 2024-28, meaning the existing records could not be used to reconcile broker-reported proceeds without first rebuilding the methodology on an account-by-account basis.
What We Did
Reconstructed the full cost basis history across custodial and non-custodial environments, establishing lot-level records for all assets with legacy basis. Transitioned the methodology from universal pooling to account-level tracking in compliance with Rev. Proc. 2024-28. Reconciled all broker-issued 1099-DA data against the rebuilt records, documented the basis for each discrepancy between broker-reported proceeds and client records, and incorporated all unreported DEX activity into the return. Prepared Form 8949 with complete, accurate, and IRS-defensible positions across every transaction category.
The Outcome
Current year return filed with all 1099-DA data fully reconciled, legacy basis properly documented, and DEX activity captured and correctly reported. Methodology aligned with Rev. Proc. 2024-28 going forward, eliminating the pooling mismatch that had created exposure under the new broker reporting framework. Client now has a defensible, continuous cost basis record that will hold up as 1099-DA reporting expands in subsequent years.
