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If you trade crypto, 2026 is the year I’d stop “winging it.”

The big shift is Form 1099-DA. And here’s what the IRS doesn’t advertise: this isn’t just another information form. It’s a matching tool. A very sharp one.

For years, crypto reporting was messy enough that a lot of bad returns slipped through because the IRS didn’t always have transaction-level visibility. That changes now. The new 1099-DA is much closer to a broker reporting system. Exchanges can report each sale or exchange, and the IRS gets that copy too.

That matters because crypto is no longer just floating around as “other property” in the background. It’s now being carved out separately on Form 8949 and feeding into Schedule D in a way that makes IRS matching much easier.

That’s the real story.

The IRS can now look at your crypto proceeds on the crypto-specific boxes of Form 8949 and compare those totals to what came in on the 1099-DAs. If your reported proceeds come in under what the IRS already has on file, you’ve basically created your own notice.

Not always a full-blown field audit. Often worse in a way: a cold, computer-generated letter assuming you underreported income.

And that’s where a lot of taxpayers get burned. They think the issue is gain. Sometimes the issue is proceeds. If the IRS sees $300,000 of reported crypto sales from exchanges and your return only shows $220,000 in crypto proceeds, the machine doesn’t start by asking whether your basis records are complicated. It starts by asking where the missing $80,000 went.

That’s why I keep telling people: your total reported proceeds need to at least reconcile to the IRS record. Then you separately fix basis correctly on the return.

There’s also a lot of confusion around what 1099-DA does not report. It generally doesn’t solve your cost basis problem for you, especially when assets moved across wallets, hardware storage, or multiple exchanges. It’s reporting sales activity. It is not magically reconstructing your tax life.

So if you bought on one platform, transferred to cold storage, moved coins around, and later sold somewhere else, you still have to do the ugly work of tracing basis.

And yes, this is where crypto tax software starts promising a little too much.

I use software. I like software. But software is a tool, not a tax opinion. If transfers are misclassified, wallets are missing, fees are ignored, or lot tracking is broken, the output can look polished and still be wrong. The IRS does not care that the PDF looked official.

The other quiet landmine here is specific identification.

In theory, taxpayers love it because it can produce better tax results than FIFO. In practice, most people do not maintain the kind of contemporaneous records needed to defend it. That’s the part people skip over. You don’t get to casually decide later which lots you meant to sell. If you want specific ID to hold up, you need records made before the transaction, and they need to be consistent with what actually happened.

For most real-world crypto traders, especially those using multiple exchanges and private wallets, that’s a very high bar.

So what ends up happening? People mix methods, trust exchange defaults they don’t understand, manually override basis in random places, and create a recordkeeping mess that collapses the second anyone examines it.

My practical view: if you have one contained account and no transfers, you may have more flexibility. But once you start moving assets between platforms and wallets, simplicity becomes a tax strategy. FIFO may not always be the most aggressive answer, but it is often the most survivable one.

A few things stood out to me that taxpayers really need to hear:

• Transfer fees can be reportable events.
• Wallet privacy is not a reason to omit transactions from Form 8949.
• Giving an exchange guessed cost basis data can create bigger problems later.
• Safe harbor did not erase your ongoing reporting obligations.
• Gifts carry basis rules that people routinely misunderstand.

That last one catches families all the time. If someone gifts you Bitcoin, you generally inherit the donor’s basis. Which sounds simple until nobody kept the records.

This whole area is moving toward one unavoidable truth: crypto is becoming more like brokerage reporting from an enforcement standpoint, without becoming easier for taxpayers from a recordkeeping standpoint.

That’s the trap.

More reporting to the IRS. More matching. More notices. But still plenty of basis gaps, wallet fragmentation, transfer complexity, and software limitations.

So if your plan is to file a neat little summary number and hope for the best, I wouldn’t do that.

I’d make sure the 1099-DA totals are accounted for, the Form 8949 crypto entries are complete, and the cost basis methodology is something you can actually defend if a notice shows up six months later.

Because once the IRS computer sees a mismatch, you don’t get credit for meaning well.

A stat like “60% more homes for sale” gets attention fast, and I understand why. A lot of people hear that and immediately assume prices must be falling next.

But that’s not what I’m seeing in Rochester right now.

The resale market has clearly loosened up compared to a year ago. Inventory went from 252 homes in August 2025 to 404 in August 2026, which is a meaningful jump. Buyers have more options, more room to compare, and in some cases more negotiating leverage than they’ve had in a while.

At the same time, prices really haven’t broken down. The median sale price moved from $334,000 to $340,000, and the 12-month rolling median appreciation is sitting around 1.7%.

That’s not strong appreciation. I wouldn’t call it exciting. But I also wouldn’t call it a correction.

To me, this looks a lot more like a market that’s normalizing than one that’s unraveling.

A few things can be true at once:

• inventory can be up sharply
• homes can take longer to sell
• closed sales can soften
• and prices can still hold relatively steady

That’s basically where Rochester is right now.

Homes are taking longer to move, with median days on market rising from 18 to 24 days. New listings were also up 22%, while closed sales were down about 8%. That tells me the market is still functioning, but it’s absorbing supply more slowly.

And that’s the key point.

More inventory only puts real downward pressure on prices when supply starts to overwhelm demand for a sustained period. We’re not fully there. Overall months of supply is about 3.1, and by the usual definition, a balanced market is closer to 6 months.

So yes, buyers have more leverage than they did in the frenzy years. But no, Rochester as a whole hasn’t flipped into a true buyer’s market.

What I think matters most right now is that this market is getting more segmented by price point.

Under $500K, supply is still fairly tight:

• under $300K: 2.8 months
• $300K–$399K: 2.8 months
• $400K–$499K: 2.6 months

That’s still seller-leaning.

But once you move up the ladder, conditions loosen up:

• $500K–$749K: 4.5 months
• $750K+: 3.9 months

That’s where buyers start to gain more breathing room, especially in the $500K to $750K range.

This is why broad market headlines can be misleading. If you’re shopping under $400K, your experience may still feel pretty competitive. If you’re buying above $500K, the conversation changes. More choices, less urgency, and more room to negotiate.

For sellers, I’d take this as a cue—not a panic signal.

The median sale-to-original-list-price ratio was still 100% in August. That tells me properly priced homes are still getting the job done. But the margin for error is smaller now. In a market with more competition, you can’t count on sloppy pricing, mediocre presentation, or deferred maintenance getting a pass.

I’ve been through enough cycles to know that markets usually don’t break all at once. First you see more listings. Then homes sit a little longer. Then buyers get pickier. Then pricing becomes much more sensitive. Rochester feels like it’s in that middle transition stage right now.

So my read is pretty simple:

Prices are flattening, not collapsing.
Inventory is elevated, but it stopped climbing month over month.
Buyers have more leverage, especially at higher price points.
And sellers can still win, but only if they’re realistic.

The number I’d be watching next is months of supply. If that keeps climbing, we’ll likely see more pressure build. If inventory starts getting absorbed, this may just be a healthier reset after an overheated stretch.

That’s a much different story than “60% more homes means prices are falling.”

In Rochester, at least for now, that’s not the full picture.

A lot of reps get weird around “sophisticated” buyers.

Older buyer. Experienced buyer. Successful buyer. Analytical buyer. Already has money. Already has options.

And the rep immediately changes character.

They get nicer.
They get softer.
They stop challenging.
They hide inside “consultative.”
They mistake politeness for control.

That’s how deals drift.

Here’s the truth:

A sophisticated buyer does not need less salesmanship.
They need better diagnosis.

If I’m running discovery and the buyer says:

“I want flexibility.”
“I want freedom.”
“I’m exploring options.”
“I’m not in a huge rush.”

I’m not taking that at face value and moving to pitch.

I’m staying there.

Because most reps hear a polished answer and assume there’s nothing underneath it.

Wrong.

There’s almost always a real motive under the polished answer: loss of identity, fear of stagnation, need for a next chapter, pressure to replace income, fear of wasting years, desire to create options before time closes in.

That’s the work.

And if you don’t do that work, you get the fake stall: “I need to think about it.”

No you don’t.
You need a reason big enough to move.

That’s why I’m constantly pushing reps on one thing:

Stop solving logistics before you’ve built the case for change.

Too many people go to financing, payment options, implementation details, or “next steps” way too early.

That’s amateur hour.

If the buyer’s desired future isn’t emotionally and practically clear, then every solution conversation becomes weak.

In MEDDIC language, you haven’t built enough pain and impact.
In Sandler language, you’re skipping pain and rushing into fulfillment.
In Challenger language, you’re failing to constructively tension the gap between where they are and where they say they want to go.

And yes, that matters even more with sophisticated buyers.

Because sophisticated buyers are often better at sounding resolved than they actually are.

They can explain away urgency with polished logic: “The timing isn’t bad, I just have flexibility.”
“I’m considering a few models.”
“I could start now, or in a year.”

Cool.

My job is to break that clean little story.

Not disrespectfully.
But directly.

I’ll say it like this:

If the outcome matters in 2–3 years, when do the actions need to start?

That’s the move.

Because time is not neutral in business.
Time is either compounding for them or against them.

A lot of reps ask timeline questions just to check a box.

I’m asking timeline questions to expose whether the buyer actually believes their own story.

If you want a new income stream, a different lifestyle, more flexibility, more optionality, more security — but you’re acting like delay has no cost — I’m going to challenge that.

That’s not pressure.
That’s clarity.

Another big mistake I see: reps confuse the buyer’s current plan with the buyer’s real holy grail.

Example:

A buyer wants to relocate.
Fine. But if relocation is already happening with or without your offer, then that is not the value driver.

So stop selling the wrong future.

The real future might be: their next venture, their next identity, a scalable income stream, a long-term asset, a better way to work, a path to avoid going backwards in a few years.

That’s why surface-level discovery kills sophisticated deals.

These buyers don’t need a rep who can ask questions.

They need a rep who can think.

Read between the lines.
Track what’s already funded.
Separate lifestyle goals from economic goals.
Figure out what your offer actually solves in their world.

That’s the difference between a scripted closer and a real salesperson.

And let me be a little aggressive here:

If you’re afraid to challenge older buyers, richer buyers, smarter buyers, or more accomplished buyers, you are not respecting them.

You are protecting yourself.

Big difference.

Respect does not mean letting someone stay vague.
Respect means being willing to ask the question that makes the call real.

Sometimes the whole unlock is one frame:

I’m willing to break the social norm on this call.

Because sales is already a social norm break.

You are talking to someone about changing their behavior, changing their business, changing their future, and parting with money.

That is not a normal conversation.

So if you show up trying to be normal, comfortable, and universally likable, you’re cooked.

I want reps who can sit in the tension and ask:

Why now?
Why this?
What happens if this drifts?
What are you actually building toward?
And if that future matters, why are you treating the start date like it’s optional?

That’s how you close sophisticated buyers.

Not by sounding fancier.
Not by being smoother.
Not by vomiting more certainty.

By having the backbone to lead a real conversation.

That’s sales.

And no, nobody is born knowing how to do that.
It’s trained.