Money does not look the same anymore. For many people, it hasn’t for years. By 2026, a growing number of taxpayers earn income through crypto trading, digital assets, online platforms, and gig work. Some drive. Some sell. Some trade tokens late at night and get paid through an app instead of a paycheck. The freedom is nice. The tax side? Not always.
The IRS has noticed. Reporting rules are clearer now, forms are expanding, and enforcement is stronger than it used to be. If you earn gig economy income or deal with digital assets, understanding your reporting obligations is no longer optional.
At SCL Tax Services in Bronx, NY, we see this shift up close. And we see where people get stuck. We are here to explain everything, so let’s begin! Digital asset taxes are no longer new!
Digital asset taxes used to feel experimental. Not anymore!
The IRS treats most digital assets, including cryptocurrency, as property. That simple classification carries weight. Selling crypto, trading it, or even using it to pay for something can trigger a taxable event.
In 2026, reporting crypto trades remains a top priority for the IRS. This includes:
- Selling crypto for cash
- Trading one coin for another
- Using crypto to pay for goods or services
Many people still think, “I didn’t cash out, so it doesn’t count.” That’s one of the most common mistakes we see. To tighten reporting, the IRS rolled out a new form.
The crypto tax Form 1099-DA
The crypto tax form 1099-DA was introduced to improve reporting for crypto and other digital-asset sales. Exchanges and brokers may issue this form to summarize your activity.
But here’s the part that matters most: you must report the income even if you do not receive the form. No 1099-DA does not mean no tax. It never has! The IRS can still compare exchange data, wallet activity, and prior filings. Forms help. They don’t define your responsibility.
Tracking basis matters more than people think
Cost basis is where digital asset taxes often fall apart. Your basis is what you paid for the crypto, including fees. Without it, gains look bigger than they are. Or worse, the numbers don’t make sense at all.
A few habits make a big difference:
- Save purchase confirmations
- Record dates, amounts, and fees
- Track transfers between wallets
Moving crypto between wallets is not taxable. But without records, it can look like a sale. That’s how problems start. Clear basis tracking makes reporting crypto trades far less stressful.
Gig economy income is still income
Gig economy income shows up in many forms. Driving apps. Freelance work. Selling products online. Digital services. Side hustles that slowly became a main income.
For 2026, the 1099-K threshold 2026 remains $20,000 and 200 transactions for third-party payment platforms.
This affects:
- PayPal and Venmo taxes
- Etsy and eBay taxes
- Other online marketplaces
Still, the rule stays the same. Income is taxable whether or not you receive a 1099-K. The form is just a reporting tool.
Digital wallet payments count
More people are paid through digital wallets now. Sometimes exclusively. If the payment is for goods or services, it counts as income. The platform does not change that.
Helpful habits:
- Keep business and personal payments separate
- Download transaction summaries regularly
- Label transfers clearly
Mixing everything together usually leads to underreporting. Or confusion. Or both.
Estimated quarterly taxes and gig work
Most gig workers do not have taxes withheld. That’s where estimated quarterly taxes come in.
If you expect to owe tax, you may need to make payments throughout the year. These payments cover income tax and self-employment tax for 2026, which fund Social Security and Medicare.
Skipping estimated payments often leads to penalties. And surprise balances in April. You do not need a perfect system. Just a consistent one. Setting aside a portion of each payment goes a long way.
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Self-employment tax in 2026
Self-employment tax 2026 applies to net earnings from gig economy income. It’s separate from regular income tax.
Deductions can reduce what you owe. Common ones include:
- Platform fees
- Supplies and equipment
- Home office expenses, when allowed
Good records support deductions. Poor records make them risky.
Recordkeeping is your safety net! If there’s one thing that protects you, it’s recordkeeping.
This is one of the most practical gig economy tax tips there is:
- Save receipts digitally
- Keep platform and exchange reports
- Use simple spreadsheets or software
Relying on memory works until it doesn’t.
Avoiding IRS penalties for unreported income
IRS penalties for unreported income are not theoretical. They happen. And they add up.
The IRS compares what you report with forms like 1099-DA and 1099-K. When numbers don’t line up, that’s a signal.
Accurate reporting, clear documentation, and timely filing reduce that risk. If something was missed in the past, addressing it early is usually the better move.
How SCL Tax Services supports you
Digital assets and gig work offer flexibility. They also bring responsibility. By 2026, the IRS will have more tools, more data, and clearer rules than ever before. Reporting everything correctly is no longer optional, and small errors can lead to real IRS penalties for unreported income.
At SCL Tax Services, based in the Bronx, NY, we work with crypto traders, digital-asset investors, freelancers, and gig-economy workers across New York. We help clients understand reporting obligations, track cost basis, organize platform records, and plan for estimated quarterly taxes. Our focus is accuracy, clarity, and peace of mind.
If you earn income outside a traditional paycheck, now is the time to get organized. Reach out to SCL Tax Services and move into the 2026 tax year without financial issues.
Do I have to report crypto income if I did not receive Form 1099-DA?
Yes. All taxable digital asset activity must be reported, even without the form.
What is the 1099-K threshold for 2026?
The threshold is $20,000 and 200 transactions for third-party payment platforms.
Are PayPal and Venmo payments taxable?
Payments received for goods or services are taxable income, regardless of the platform.
How do I report gig economy income without a 1099?
You report it using your own records. Forms help, but they are not required to file.
Can estimated quarterly taxes reduce penalties?
Yes. Estimated quarterly taxes can reduce interest and IRS penalties for unreported income.