Crypto Taxes: What Happens If You Guess Wrong?

A big change this year is the new IRS form 1099-DA. For the first time, brokers have to tell both you and the government how much you earned from crypto trades. It's like what happens with stocks, but with a big difference: they don't have to tell the IRS what you paid for your crypto. That means you're the one stuck with the math.Many people are confused. A recent survey found that 61% of crypto users didn't even know about the new rules before tax season. Half of them worry they’ll mess up their taxes and get fined. The IRS isn’t making this easy. Their criminal team is now watching crypto closely, so mistakes could lead to serious trouble. The worst-case penalty for tax fraud is a $100, 000 fine and five years in jail. But if you come clean before they catch you, the punishments are much lighter. Either way, keeping your own records is key. Don’t just trust what exchanges send you—double check everything. One small mistake could cost you big.