Crypto Tax in United States

If you sold, swapped, spent, or earned crypto in the US, the IRS wants it on your return, and with the new Form 1099-DA, it now receives data from your exchanges too. This guide covers how crypto is taxed, which forms you file, and what changed for the 2025 tax year. CryptaTax then builds your US report from your transaction history.

This is general information, not tax advice. US crypto rules change and depend on your circumstances. Confirm the current position with the IRS or a qualified tax professional.

Is crypto taxed in the US?

The IRS treats cryptocurrency as property, not currency. So disposing of it can trigger capital gains tax, and earning it can be ordinary income. Buying and holding isn't taxable, tax applies when you dispose of crypto or receive it as income. Note that every Form 1040 now includes a digital-asset question you must answer "Yes" or "No".

Capital gains

You owe capital gains tax when you dispose of crypto, selling for dollars, swapping one coin for another, or spending it on goods or services. Your gain is the proceeds minus your cost basis (what you paid, plus fees).

• Short-term (held one year or less): taxed as ordinary income, up to 37%.
• Long-term (held more than one year): taxed at 0%, 15%, or 20%, depending on your taxable income and filing status.
• Losses offset gains; up to $3,000 of net losses can reduce ordinary income each year, with the rest carried forward.

Cost basis, important change: under Revenue Procedure 2024-28, you must track cost basis per wallet/account rather than pooling everything together. CryptaTax does this automatically.

A current planning point: the wash-sale rule

The wash-sale rule, which disallows a loss if you rebuy the same security within 30 days, applies to stocks and securities, not crypto, because the IRS treats crypto as property. As of 2026 you can sell crypto at a loss and repurchase it immediately while still claiming the loss. Congress has repeatedly proposed extending the rule to crypto, so this may change, check the current position before relying on it.

Crypto income

Crypto you earn is ordinary income at its fair market value on the day you receive it:

• Staking rewards (per IRS Revenue Ruling 2023-14), mining, airdrops, and forks → reported on Schedule 1 (or Schedule C if it's a business).

That receipt value also becomes the cost basis for working out capital gains when you later sell those coins.

Which forms do I file?

• Form 8949, every taxable disposal, split into short-term and long-term. For 2025 it has new digital-asset checkboxes. → Crypto Form 8949
• Schedule D, summarises the totals from Form 8949. → Crypto Schedule D
• Schedule 1, ordinary crypto income (staking, mining, airdrops), or Schedule C if it's a business. → Schedule 1 · Schedule C
• Form 1040, answer the digital-asset question at the top of your return. → The 1040 digital-asset question
• Form 1099-DA (new), starting with the 2025 tax year (filed in 2026), exchanges and brokers report your gross proceeds to you and the IRS. For 2025 they aren't required to report cost basis, so you generally still calculate it yourself; cost-basis reporting is being added for 2026. If your return doesn't match the 1099-DA the IRS receives, the mismatch can trigger an inquiry, so reconciling your records to the form matters. → Form 1099-DA · other exchange 1099s (MISC/K/B)
• Form 8938 / FBAR (FinCEN 114), foreign-account reporting that *may* apply if you hold crypto on non-US platforms; the rules for crypto are unsettled, so confirm your own position. → Crypto and FBAR / Form 8938
• Form 709, a gift-tax return you may need if you *gave away* crypto above the annual exclusion. → Form 709 for crypto gifts

Key dates

• Tax year: calendar year (1 January, 31 December).
• Filing deadline: April 15 (following the tax year).

How CryptaTax helps with US crypto tax

• Imports your full history from exchanges and wallets
• Tracks cost basis per wallet (aligned to Rev. Proc. 2024-28)
• Produces a completed Form 8949 (short- and long-term) and Schedule D totals, plus income for Schedule 1
• Reconciles your records against Form 1099-DA so your return matches IRS data

Common mistakes US crypto filers make

Most IRS problems with crypto come from simple oversights rather than aggressive tax positions. Knowing where other US filers slip up is the easiest way to keep your own return clean and avoid an unwelcome notice.

• Forgetting that crypto-to-crypto swaps are taxable. Trading one token for another is a disposal, even though no dollars ever hit your bank account. Many people only think to report when they cash out to USD, and understate their gains as a result.
• Treating self-transfers as sales. Moving coins between wallets you control is not a disposal, but if your records do not link the outgoing and incoming sides, software can mistake a transfer for a sale and invent a phantom gain.
• Missing income from staking, rewards, and airdrops. Crypto you earn is ordinary income on the day you receive it, and it is easy to overlook small, frequent rewards that never appeared on any exchange statement.
• Losing the cost basis on coins moved off an exchange. When you withdraw to self-custody and later sell elsewhere, the original purchase price has to follow the coins. Without it, you may end up paying tax on the full sale price.
• Answering the Form 1040 digital-asset question carelessly. The question sits at the top of the return for a reason; an inaccurate answer, set against the exchange data the IRS already holds, is an avoidable red flag.
• Assuming no 1099 means no obligation. You are responsible for reporting regardless of whether a broker sends you a form, and from the 2025 tax year, more of your activity is reported to the IRS anyway.

Record-keeping for US filers

Good records are what turn a stressful filing season into a quick one, and they are also your defence if the IRS ever asks questions. You are expected to be able to substantiate every figure on your Form 8949, so keep enough detail to reconstruct each disposal from first principles.

• The date and time you acquired each batch of crypto, and what you paid in USD including fees.
• The date and time of every disposal, with the USD proceeds and any fees deducted.
• The fair market value in USD of any crypto you received as income, recorded on the day of receipt.
• Wallet addresses and exchange accounts, so transfers between them can be matched rather than counted as sales.
• Copies of any Form 1099-DA you receive, so you can reconcile them against your own records.

Because cost basis now has to be tracked per wallet or account rather than pooled, it pays to keep your records organised by venue from the start. Pulling this together years later, after an exchange has closed or you have lost an export, is where most of the pain comes from. Learn more about cost basis →.

Year-end planning for US investors

A little attention before 31 December can change your tax bill for the year. None of this is about avoiding tax, it is about not paying more than you need to.

Mind the one-year line

The gap between short-term and long-term treatment is large. A coin sold just before its first anniversary is taxed as ordinary income; held a little longer, the same gain can qualify for the lower long-term rate. Where you have flexibility on timing, knowing exactly when each lot crosses the one-year mark is valuable, see the summary table on this page for the current rates.

Harvesting losses

If you are sitting on positions worth less than you paid, selling them can crystallise a loss that offsets your gains and, within limits, some ordinary income, with anything left over carried forward. Because crypto is treated as property, the wash-sale rule that restricts this for stocks does not currently apply, though, as noted earlier on this page, that could change. Read more on tax-loss harvesting →.

Gifts and donations

Giving crypto away or donating appreciated coins to a qualifying charity can have very different tax outcomes from selling. The rules are specific, so check the current IRS position for your situation before acting.

DeFi, NFTs and newer activity

The further you move from a simple buy-and-sell on a centralised exchange, the more care your reporting needs. The IRS has not issued detailed guidance for every DeFi mechanism, but the underlying principles still apply: a disposal is taxable, and earning crypto is income.

• DeFi lending and liquidity pools can involve disposals when you deposit or withdraw, and income when you earn rewards. Each protocol behaves differently, so the transactions need to be classified individually.
• NFTs are taxed as property too: minting, buying, selling, and trading them can all be taxable events, and some may face different treatment as collectibles, an area worth confirming.
• Airdrops and rewards are income at their value on receipt, which then becomes the cost basis for any later sale.
• Wrapped tokens and bridging can be disposals depending on the facts, so do not assume that moving between equivalent assets is always tax-free.

CryptaTax imports this activity directly from your wallets and helps classify it, but the more complex your DeFi footprint, the more worthwhile a quick review with a professional becomes. See our guide to staking →.

What if you have never reported your crypto?

If you have realised gains or earned crypto income in past years and did not report it, you are far from alone, and it is usually better to put it right yourself than to wait for the IRS to make contact. With brokers now reporting data through Form 1099-DA, the gap between what you filed and what the IRS sees is easier than ever for them to spot.

Generally you can amend prior-year returns to include the missing activity. The IRS has established procedures for correcting past filings, and coming forward voluntarily typically puts you in a better position than being contacted first. Because penalties and interest can apply, this is a situation where professional advice is genuinely worth it. CryptaTax can rebuild your history across past years so you have accurate figures to work from.

How CryptaTax automates your US crypto taxes

Doing all of this by hand across several exchanges and wallets is slow and error-prone. CryptaTax connects to your accounts, pulls in your full transaction history, and turns it into the numbers your return needs.

• Aggregates every trade, transfer, and reward across all your venues into one timeline.
• Tracks cost basis per wallet in line with current IRS rules, and matches self-transfers so they are not taxed as sales.
• Separates short-term from long-term gains and produces completed Form 8949 and Schedule D figures, plus income for Schedule 1.
• Lets you reconcile against any Form 1099-DA so your return lines up with the data the IRS holds.
• Keeps an auditable record behind every number, so you can stand behind your return if asked.

Do I owe tax if I only bought crypto and never sold?

No. Buying and holding is not a taxable event in the US. Tax applies when you dispose of crypto or receive it as income, but you should still answer the Form 1040 digital-asset question accurately.

Are gas and transaction fees deductible?

Fees connected to acquiring or disposing of crypto generally adjust your cost basis or proceeds rather than being claimed separately. The treatment depends on the transaction, so keep a record of every fee and confirm the current position.

Is crypto lost in a hack or scam deductible?

The rules around lost, stolen, and worthless crypto are narrow and have changed in recent years. Do not assume a loss is automatically deductible, check the current IRS position or speak to a professional before claiming one.

Does my state tax crypto too?

This page covers federal tax. Most states with an income tax follow the federal treatment of crypto gains and income, but rates and rules vary, so check your own state's position alongside your federal return.

How does CryptaTax handle data from multiple exchanges?

It merges your activity from every connected exchange and wallet into a single history, so cost basis carries correctly when coins move between them and nothing is double-counted. See our integrations →.