Tax rules call a self-custody wallet an unhosted wallet: a non-custodial way to store the private keys to your crypto. It can be software connected to the internet, called a hot wallet. It can also be hardware kept offline, called a cold wallet.
No broker holds your coins there, so swaps inside the wallet get no Form 1099-DA. A crypto kiosk or payment processor may still report a sale you fund from the wallet. A 2024 IRS rule would have made decentralized finance (DeFi) platforms file the form too, but Congress overturned it in April 2025.
The tax is the same as anywhere else: you report each sale or swap from the wallet yourself. You also keep the records, including each coin’s basis and purchase date. Moving coins between your own exchange account and wallet is not taxed. A network fee paid in crypto is different, because spending the coins on the fee disposes of them.
Sources
- 26 C.F.R. § 1.6045-1(a)(25), Wallet, hosted wallet, unhosted wallet
- 26 C.F.R. § 1.1012-1, Basis of property
- Public Law 119-5 (H.J. Res. 25), disapproving the IRS rule on DeFi broker reporting
- IRS, Digital assets
Reviewed and updated September 2026. General information, not advice for your situation.