Crypto Tax Software for Businesses, Complete Compliance Without Gaps

Sovos Cryptocurrency Tax Compliance

From tax IDs to cost basis to 1099-DAs, every step of crypto tax compliance is covered in one connected solution built for accuracy, scale, and confidence.

  • Compliance without gaps
  • Reduced Risk of Penalties and Withholding
  • Efficiency and Scalability from Day One

Leverage a proven solution

With nearly 40 years of expertise in information reporting, Sovos processes hundreds of millions of tax forms each year for over 30,000 customers. Since 2008, we have been a trusted partner in broker transaction reporting, seamlessly expanding into digital asset reporting to ensure compliance across all asset types.

Benefits of Sovos Crypto Tax Reporting

Compliance without gaps

All the moving pieces connected in one place. Tax ID verifications, cost basis tracking, and 1099-DA reporting working together so you get compliance right the first time.

Reduced Risk of Penalties and Withholding

Compliance done right, so you don’t pay the price with costly penalties, backup withholding, or regulators questioning your reporting accuracy.

Efficiency and Scalability from Day One

Scale reporting without scaling your workload. Automation takes care of the heavy lifting so your team can focus on growth, not busywork.

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Smarter Way to Handle Crypto Tax Compliance – Here’s How

Consolidate 1099 and Withholding obligations

Unify tax ID collection and verification, digital asset cost basis, and 1099-DA reporting in one connected solution that also manages traditional securities, giving you complete, gap-free compliance across all asset classes in a single platform.

Process large transaction volumes

Confidently process millions of digital asset transactions per minute. Sovos is built to handle high-frequency, high-volume trading environments without bottlenecks, ensuring accurate and timely 1099-DA reporting even when transaction complexity and scale increase dramatically.

Generate combined tax statements

Deliver investors and account holders clear, consolidated tax statements across traditional and digital assets, including 1099-B, 1099-DA, 1099-DIV, 1099-INT, 1099-MISC, 1099-OID, and 1099-PATR, while improving transparency, reducing confusion, and protecting sensitive data.

File with the IRS via IRIS

As an early adopter of the IRS IRIS system and with continuous monitoring of changing state requirements, Sovos ensures you stay ahead of evolving regulations and remain prepared for every compliance update.

Comply with state reporting requirements

Sovos monitors all direct state reporting rules, thresholds, and deadlines—so you don’t have to. Our built-in compliance ensures your filings meet evolving state regulations, even with last-minute changes.

Cost Basis Without Compromise

Handle the complexities of digital asset cost basis including transfers, swaps, and staking while also supporting traditional securities, bringing both sets of data together for accurate, complete reporting.

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Frequently Asked Questions

Yes, Sovos 1099 Reporting supports all federal and state filing requirements, even as they evolve leading up to the reporting deadline.

Form 1099-DA is being built exclusively on IRIS, the IRS’s new filing system, and is not supported on the legacy FIRE system. Since all 1099-DA filers must use IRIS, it makes sense to consolidate filing for all available form types on the same platform. The primary form not yet available on IRIS is Form 1042-S, but development for it began in early 2025.

Penalties for 1099-DA filings are the same as other 1099 forms. Beginning with tax year 2026, 1099-DA will be subject to backup withholding, meaning enforcement of missing or incorrect name/TIN combinations will begin then. Incorrect name/TIN combinations for 2025 filings may result in penalties of $340 per incorrect record. Learn more about penalties here.

Once data is added to the system, it goes through multiple validations, including IRS-specific checks. These validations ensure all required fields are populated, addresses are formatted correctly, and IRS rules—such as code and percentage combinations—are followed. This helps prevent errors before submission.

Are You Fully Compliant with Cryptocurrency Tax Regulations?

Sovos can help.

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