The crypto tax season has started, and the IRS’s latest move is a welcome relief for investors. In new guidance announced last week, crypto holders using centralized exchanges can use alternative reporting methods instead of the FIFO method required by the IRS. This means the agency is easing the tax burden for the second time and trying to protect crypto investors’ wallets.

Let’s first recall what happened initially. The IRS required crypto exchanges to track the buy and sell prices for each coin using the FIFO (ilk giren ilk çıkar) system. This was bad news for investors because the oldest coins you bought at lower prices were reported first. Coins that increased in value a lot led to higher capital gains tax. The result? A bigger tax bill.

Now, using alternative methods, you can include newer coins whose value hasn’t gone up much—or that are at a loss—in your reports. According to Shehan Chandrasekera, head of tax at CoinTracker, this guidance, despite some legal issues, provides significant relief to investors.

But the IRS’s move isn’t just out of kindness. The strict reporting regime that creates a compliance burden on crypto exchanges and brokers is putting pressure on operators. Reporting the cost basis of every crypto asset to the IRS for every investor, as well as sending physical copies to clients… that’s a huge operational burden. To ease this, the agency has chosen phased reporting that includes only gross income in 2025. For assets purchased in 2026, cost data will be included in Form 1099-DA.

Earlier this month, the IRS proposed removing physical copies and making electronic submission the default. The temporary relief will be extended until the end of 2026. For crypto investors, this period is a good opportunity to reorganize their tax strategies—especially for those actively trading on centralized exchanges, for whom this flexibility provides a significant advantage.