Form 1099-DA and crypto payments: what a US merchant paid in USDC should know.

What this post covers, and what it does not

This post sets out what the IRS has published about Form 1099-DA, quoted from irs.gov as of 15 October 2026, and how a USDC payment through Fianto moves. It is not tax or legal advice. It does not tell you whether you must file anything or what you owe; a tax adviser who knows your business answers that.

The record-keeping side, meaning what to note for each payment and how the IRS values USDC received as income, is in accounting for USDC revenue. This post stays on the form itself.

What is Form 1099-DA?

Form 1099-DA, "Digital Asset Proceeds From Broker Transactions", is the return a broker files with the IRS, and copies to its customer, for each sale of digital assets it effects for that customer. The IRS digital assets page says the reporting is "required to be made on Form 1099-DA beginning with transactions on or after Jan. 1, 2025."

For this form, a digital asset is any digital representation of value recorded on a cryptographically secured distributed ledger, such as a blockchain, and the IRS lists stablecoins among its examples. USDC on Solana is in scope as an asset. Whether a particular transaction is reported depends on who carried it out.

The rules arrive in stages. The IRS sets them out as follows:

Who has to file Form 1099-DA?

Brokers file Form 1099-DA. The instructions say: "A broker includes any person who, in the ordinary course of a trade or business, stands ready to effect sales of digital assets to be made by others." In practice the digital assets page names who the final regulations apply to: "brokers that take possession of the digital assets being sold by their customers, including operators of custodial digital asset trading platforms, certain digital asset hosted wallet providers, digital asset kiosks and certain processors of digital asset payments (PDAPs)."

A processor of digital asset payments, as the instructions define it, is a broker who "regularly facilitates payments from one party to a second party by receiving digital assets from the first party and paying those digital assets, cash, or different digital assets to a second party". The instructions call the first party's payment to such a processor a "PDAP sale", so what the processor reports is the paying customer's sale, not the merchant's receipt.

Non-custodial services sit outside the 2024 rules. The IRS page says the final regulations "do not include reporting requirements for brokers commonly known as decentralized or non-custodial brokers that do not take possession of the digital assets being sold or exchanged." A separate rule for those brokers, published on 30 December 2024, was disapproved by Congress in Public Law 119-5, approved on 10 April 2025, which says that rule "shall have no force or effect."

Will a merchant paid in USDC receive a Form 1099-DA?

A merchant receives a Form 1099-DA when a broker effects a sale of digital assets for that merchant, which most often means selling USDC for dollars on an exchange. Getting paid in USDC is a different event. The IRS digital assets page treats both sides of a payment as digital asset transactions for the yes/no question on your return: under "Received digital assets for" it lists "Payment for property or services provided", which is your side, and under disposals it lists "In exchange or trade for property, goods or services in any amount", which is your customer's side.

With Fianto, the first row is the normal case. The customer signs one Solana transaction that sends your price straight to your receiving wallet; when there is a fee, a second transfer in the same transaction sends it to Fianto's treasury. Fianto never holds your money, keeps no balance and makes no payouts, as how money moves in the docs explains. Fianto also asks payers for no identity details or taxpayer number, and it does not calculate, collect or file tax; sales taxes are covered in VAT and sales tax on USDC sales.

How do the $600 and $10,000 thresholds work?

Two de minimis rules in the 2026 instructions decide whether small stablecoin and payment-processor activity is reported at all. They are per customer, per broker, per year:

A "qualifying stablecoin" must meet three conditions: it is designed to track one government currency one-to-one, it uses an effective stabilization mechanism, and it is generally accepted as payment by people other than the issuer. A "designated sale" is any sale of it except one for other digital assets that are not qualifying stablecoins, so selling USDC for dollars is designated. The optional method is the broker's choice, not yours. A processor of digital asset payments that uses it may apply it first and then test only the remaining PDAP sales against the $600 threshold.

A worked example

Say Brisklow, a US merchant, takes 30,000 USDC in subscription and one-off payments during 2026 through Fianto, all into its own wallet. Those receipts produce no Form 1099-DA. In November it moves 12,000 USDC to a US exchange that uses the optional method and sells it for dollars.

1. About $12,000 of designated sales is over the $10,000 threshold, so the exchange reports them, aggregated, on one Form 1099-DA for USDC.
2. Had Brisklow sold 9,000 USDC instead, the exchange would not be required to report those sales. That is a rule for the broker only: the IRS page says "If you have digital asset transactions, you must report them whether or not they result in a taxable gain or loss."
3. Either way, the exchange is not required to report basis. The instructions list as noncovered "a digital asset that was transferred in to the broker providing custodial services", and basis reporting is required only for covered securities.

That last point is why your own records matter. For digital assets received for services, the IRS digital asset FAQ (Q59) says "your basis in the digital assets is the fair market value of the digital assets, measured in U.S. dollars, when received, provided that you include the fair market value of the digital assets in income." The starting figure is the value when the payment arrived, a moment the exchange never saw.

What records line up with a Form 1099-DA at year end?

The records that line up with a 1099-DA are your own receipt records, because the form covers the sale and nothing before it. The IRS asks you to keep records of "the fair market value as measured in U.S. dollars of all digital assets received as income or as a payment in the ordinary course of a trade or business." For payments through Fianto, the payments export in the dashboard covers the receipt side:

An export covers up to 366 days and 50,000 rows, so one file can hold a tax year. What the export does not hold is a dollar value: add the value you use for each payment and its source. On the sale side, keep the exchange's statement and the transfer that moved the USDC there. Moving the money out of USDC is covered in turning USDC revenue into local currency.

What should a merchant ask a tax adviser about Form 1099-DA?

A tax adviser can only check what you bring, so bring the facts in the order the IRS uses them. Four questions cover most merchants paid in USDC:

1. How should I value each USDC payment in dollars, and which source should I use every time?
2. Does a 1099-DA from my exchange, with no basis reported, match the receipts I recorded?
3. Do any of the services I use to get paid count as brokers for my customers' side of the payment?
4. Which rules outside the IRS apply to my business? Licensing questions are in do you need a licence to accept crypto payments, and the US stablecoin law is in the GENIUS Act explained for merchants.

The IRS updates this area often. The instructions point to IRS.gov/Form1099DA for "the latest information about developments related to Form 1099-DA", and that is the page to check before you file.