Your Client’s Crypto Just Got Reported to the IRS: Form 1099-DA Mismatches, Wrong-Basis CP2000 Notices, and Defending Digital Asset Audits After Paschall

Miles B. Fuller, Attorney | Law Offices of Miles B. Fuller, PLLC

Miles B. Fuller is a federal tax controversy attorney who defends taxpayers in IRS audits, IRS Appeals, collection matters, and United States Tax Court litigation, with a particular focus on digital asset tax issues. He spent more than fifteen years as Senior Counsel in the IRS Office of Chief Counsel, where he served as Lead Attorney for the IRS Digital Asset Cadre and played a key role in helping the IRS’s civil examination function establish its digital asset enforcement program. He is based in Colorado and represents taxpayers throughout the Denver metro area and the Rocky Mountain region, and is regularly retained on federal tax matters nationally and internationally.

• Education & Credentials

Miles earned his Juris Doctor, cum laude, from the Fowler School of Law at Chapman University and his Master of Business Administration from the Argyros College of Business & Economics at Chapman University. He is admitted to practice before the United States Tax Court and in California, and practices in Colorado on federal tax matters.

• Recognition & Leadership

Miles is regularly quoted on digital asset taxation and other complex tax matters by Bloomberg Tax, Bloomberg Law, Tax Notes, Fortune, Business Insider, CoinDesk, and the Journal of Accountancy, and has appeared on Bloomberg Markets and CoinDesk TV. He has delivered keynote addresses at the Token Summit in Liechtenstein and the Crypto Tax Summit in Miami, and has presented on digital asset tax and enforcement at the American Bar Association Tax Section, Chainalysis Links NYC and Trace DC, Digital Assets at Duke, the Florida Bar Association, the IAFCI Crypto Summit, and the FTA State Tax Conference.

• Professional Involvement

Miles teaches as an adjunct professor at the University of Denver, Sturm College of Law. After leaving IRS Counsel, he served as Senior Director of Government Solutions at Taxbit, a digital asset tax compliance company, advising government agencies and industry on digital asset tax reporting and policy, and he continues to work with the IRS and governments worldwide on investigating cryptocurrency matters and developing tax policy.

• Experience

At the IRS Office of Chief Counsel, Miles led the Digital Asset Cadre, coordinating and training attorneys on cryptocurrency legal issues, examination techniques, and tax computations, and worked on guidance and policy issues involving distributed ledger technology. He tried more than twenty cases in the United States Tax Court, producing more than twenty-five court opinions, including six precedent-setting decisions, in matters such as Samueli, Boltar, Mitchell, Legg, Mazzei, Begay, Roth, Wells, Richlin, and Zia-Ahmadi. His advisory and litigation experience spans cryptocurrency, conservation easements, microcaptive insurance arrangements, individual retirement accounts, economic substance, collection matters, and civil fraud.

SESSION 1 – The First Form 1099-DA Season — Gross Proceeds Without Basis, Wallet-by-Wallet Rules, and Why the IRS’s Numbers Are Often Wrong |2:30pm – 3:30pm

This session explains what information the IRS now receives and how it uses it. Attorneys will walk through the final broker reporting regulations under section 6045 and the phased rollout of Form 1099-DA: gross-proceeds-only reporting for 2025 transactions, mandatory basis and holding-period reporting for 2026 transactions, the transitional penalty relief and the deferral of reporting on staking, lending, liquidity-pool, and wrapping transactions under Notice 2024-57, and the Congressional Review Act repeal of the DeFi broker rule that leaves decentralized exchanges and unhosted wallets outside the reporting net. The session then turns to the basis rules that determine whether a client actually owes anything: the shift from universal to wallet-by-wallet accounting under Treas. Reg. § 1.1012-1(j), FIFO as the default and the mechanics of specific identification and standing orders, Notice 2025-7 relief, and the consequences for clients who missed the January 1, 2025 Rev. Proc. 2024-28 safe harbor and now hold orphaned basis. Attorneys will learn how gaps in the reporting regime may create compliance risks and possible IRS audit flags. Attorneys will learn how to deal with those issues through reconstructed basis from on-chain records and exchange exports, and how to present that reconstruction so it survives IRS scrutiny.

BREAK | 3:30pm – 3:40pm

SESSION 2 – When the Letter Arrives — Responding to Letters 6173, 6174, and CP2000, Defending the Digital Asset Examination, and Litigating After Paschall | 3:40pm – 4:40pm

This session moves from reporting regime to IRS enforcement. Attorneys will learn how to triage the IRS’s digital asset correspondence: the informational Letters 6174 and 6174-A, the response-required Letter 6173, and the CP2000 proposed adjustment with its 30-day window, including how to rebut a CP2000 that treats gross proceeds as gain, understand the digital asset question on Form 1040, and decide between an amended return, a reasonable-cause penalty defense, and a voluntary disclosure where willfulness is a concern. The session then explores how digital asset examinations are built, from John Doe summonses to exchanges and the blockchain analytics that trace transfers to unhosted wallets, to the accuracy-related and civil fraud penalties, the six-year statute for substantial omissions, and information document requests that demand wallet addresses and transaction histories. Attorneys will then review the case law that now governs the merits: Rev. Rul. 2023-14 and Paschall v. Commissioner on staking income, the pending Jarrett II refund suit, the treatment of airdrops, forks, mining, NFTs as collectibles, and lost or frozen assets on bankrupt platforms, and the strategic choice among IRS Appeals, a Tax Court deficiency case, and a collection due process hearing. The session closes with an update on the legislative landscape an current proposals.