Crypto taxes explained: Bitcoin coin with a tax form and calculator

Crypto Taxes in the US: The Easy Beginner’s Guide (2026)

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In a nutshell: Crypto taxes in the US work much like taxes on stocks: the IRS treats crypto as property, so you owe tax when you sell, swap or spend it for more than you paid. Crypto you earn, such as staking rewards, mining income or pay for work, is taxed as ordinary income. Simply buying and holding crypto with dollars is not a taxable event, but you still need good records.

Last updated: September 28, 2026. Tax figures are for US federal taxes and are dated where mentioned. State rules vary.

If you bought, sold or earned crypto this year, you probably have questions about crypto taxes. What counts as taxable, which forms do you need, and what is the new Form 1099-DA? This guide explains how crypto is taxed in the US in plain English, based on IRS guidance, which is linked in the Sources section at the end.

Table of contents

How Is Crypto Taxed in the US?

The key idea behind US crypto taxes is simple: for federal tax purposes, digital assets are property, not currency. The IRS digital assets page says this applies to cryptocurrencies like bitcoin, stablecoins and NFTs.

Because crypto is property, the same general rules that apply to stocks or real estate apply here. That leads to two main types of crypto taxes:

  • Capital gains tax when you sell, trade or spend crypto that has gone up in value since you acquired it (or a capital loss if it went down).
  • Income tax when you receive crypto as payment, a reward or from activities like mining and staking.

Every Form 1040 also asks a yes-or-no digital asset question: did you receive, sell, exchange or otherwise dispose of a digital asset during the year? You must answer it even if you had no taxable gain.

Crypto Taxes: Taxable vs Non-Taxable Events

Knowing which actions trigger crypto taxes is half the battle. Based on IRS guidance, here’s how common situations generally work:

What you did Taxable? How it’s generally taxed
Bought crypto with US dollars and held it No Not taxable; keep records of your cost
Moved crypto between your own wallets or accounts No* Not taxable (*paying the network fee in crypto is itself a disposition)
Sold crypto for US dollars Yes Capital gain or loss
Swapped one crypto for another (e.g., BTC for ETH) Yes Capital gain or loss on the crypto you gave up
Spent crypto on goods or services Yes Capital gain or loss
Received staking rewards Yes Ordinary income when you gain control of them
Mined crypto Yes Ordinary income (possibly self-employment tax if it’s a business)
Got paid in crypto for work Yes Wages or self-employment income at fair market value
Received new coins from an airdrop after a hard fork Yes Ordinary income when you gain control of them
Gave crypto as a gift Usually no (for the giver) Large gifts may require Form 709; the recipient generally takes over your cost basis
Donated crypto to a qualified charity Usually no May be deductible; gifts over $5,000 generally need a qualified appraisal

A common surprise: crypto-to-crypto trades are taxable. Swapping bitcoin for XRP or any other coin counts as selling your bitcoin. (If you follow XRP, see our XRP price prediction.) The IRS has also said that like-kind exchange rules do not apply to trades such as bitcoin for ether.

Short-Term vs Long-Term Capital Gains

How much you pay in crypto taxes on a sale depends mainly on how long you held the coins:

  • Short-term: Held one year or less. Gains are taxed at your ordinary income tax rates, which range from 10% to 37%.
  • Long-term: Held more than one year. Gains get lower rates of 0%, 15% or 20%, depending on your taxable income.

For tax year 2026, the IRS set these long-term capital gains thresholds (Rev. Proc. 2025-32):

Filing status (2026) 0% rate up to 15% rate up to 20% rate above
Single $49,450 $545,500 $545,500
Married filing jointly $98,900 $613,700 $613,700
Head of household $66,200 $579,600 $579,600

These amounts refer to total taxable income, not just your crypto gains. Higher earners may also owe the 3.8% Net Investment Income Tax. NFTs the IRS treats as “collectibles” can face a higher maximum long-term rate.

Quick example: you buy $1,000 of bitcoin and sell it 18 months later for $1,600. You have a $600 long-term capital gain. Sell after eight months instead, and that $600 is short-term and taxed at your regular income rate.

Crypto Taxes on Income: Staking, Mining and Pay

Some crypto taxes have nothing to do with selling. When you receive crypto as income, you owe tax on its fair market value in US dollars at the time you receive it.

Staking rewards

Under Revenue Ruling 2023-14, staking rewards are included in gross income in the year you gain “dominion and control” over them, meaning when you can sell or transfer them. That value then becomes your cost basis for when you later sell.

Mining

For crypto taxes, mined coins are income when you receive them. If mining is a trade or business for you, you may also owe self-employment tax and would report it on Schedule C.

Getting paid in crypto

Crypto taxes on wages work like taxes on any other wages: employers must report them. Freelancers and independent contractors report crypto payments as business income on Schedule C.

Which Crypto Tax Forms Do You Need?

According to the IRS, the main forms for reporting crypto taxes are:

  • Form 1040: Answer the digital asset question.
  • Form 8949: List each sale, swap or other disposal of crypto held as a capital asset.
  • Schedule D: Summarize your total capital gains and losses from Form 8949.
  • Schedule 1: Report other crypto income, such as staking, mining (if not a business) or airdrops.
  • Schedule C: Report crypto business income, including self-employed mining or freelance payments.
  • Form 709: Report large gifts of crypto, if required.

The IRS says you must report digital asset transactions whether or not they result in a taxable gain or loss.

Form 1099-DA: New Broker Reporting

The biggest recent change in crypto taxes is Form 1099-DA, “Digital Asset Proceeds From Broker Transactions.” It works much like the Form 1099-B you get for stock sales.

  • 2025 transactions: Custodial brokers, such as centralized exchanges and certain hosted wallet providers, must report your gross proceeds. They are not required to report your cost basis.
  • 2026 transactions onward: Brokers must also report cost basis for “covered” assets, generally crypto you acquired on or after January 1, 2026 and held in the same broker account.
  • Not covered: The final regulations do not require reporting by decentralized or non-custodial platforms that never hold your crypto.

Why this matters: a 1099-DA for 2025 may show sale proceeds with no cost basis. That doesn’t mean your whole sale is taxable profit. You still use your own records to calculate your gain or loss on Form 8949. The IRS also receives a copy, so leaving sales off your return is risky.

Cost Basis and the Per-Wallet Rule

Accurate crypto taxes start with cost basis. Your cost basis is generally what you paid for your crypto in US dollars, including fees. Your gain or loss is the sale amount minus that basis.

Starting January 1, 2025, IRS rules require you to track basis separately for each wallet or account, rather than pooling all your coins together across platforms. The IRS issued Revenue Procedure 2024-28 to help taxpayers allocate their existing basis to each wallet as of that date.

Within a wallet or account, you can specifically identify which units you’re selling if you keep adequate records. Otherwise, a first-in, first-out (FIFO) method generally applies. Many people use crypto tax software or a tax professional for this.

Crypto Losses and the Wash Sale Rule

Losses can lower your crypto taxes. Capital losses first offset capital gains. If losses exceed gains, you can deduct up to $3,000 a year ($1,500 if married filing separately) against other income and carry the rest forward to future years, according to IRS Topic 409.

What about the wash sale rule? For stocks and securities, the wash sale rule disallows a loss if you buy the same investment back within 30 days. As of September 28, 2026, that rule is written for stock and securities, and crypto is treated as property, so it generally hasn’t applied to directly held crypto. That could change. On September 16, 2026, the House Ways and Means Committee advanced H.R. 10357, the Digital Asset Tax Certainty Act, which would apply wash sale rules to traded digital assets. It is a bill, not law, so check its status before relying on this strategy.

Crypto ETFs are taxed differently. See our guide to how Bitcoin ETFs work for a quick overview of how they are taxed.

Common Crypto Tax Mistakes to Avoid

  • Ignoring crypto-to-crypto swaps. Each swap is a taxable disposal.
  • Answering “No” to the digital asset question by mistake. Selling, swapping or earning crypto means “Yes.” Simply buying with dollars and holding means “No.”
  • Not tracking staking rewards. Record the dollar value on the day you gained control of each reward.
  • Relying only on your 1099-DA. It may be missing basis or DeFi activity. Keep your own records.
  • Losing records. Exchanges shut down and data disappears. Download your transaction history every year so your crypto taxes are easy to prove.

Frequently Asked Questions

Do I pay crypto taxes if I don’t sell?

Not on price gains. Holding crypto that goes up in value isn’t taxable until you sell, swap or spend it. However, crypto you earn, such as staking rewards, is taxable income when you receive it, even if you never sell.

Do I have to report crypto if I lost money?

Yes. The IRS says you must report digital asset transactions whether or not they produce a gain. Reporting losses can also reduce your crypto taxes.

Is there a minimum amount before crypto is taxable?

As of September 2026, there is no general de minimis exemption for crypto transactions under current federal law. Proposals to exempt small transactions have been introduced in Congress, but none had become law as of this update.

What if I didn’t receive a Form 1099-DA?

You still owe crypto taxes on reportable transactions. Many activities, like trades on non-custodial platforms, don’t generate a 1099-DA.

How are stablecoins taxed?

The IRS lists stablecoins as digital assets, so the same property rules apply. Because their price usually stays near $1, gains or losses are often small, but the transactions are still reportable.

Do I need a tax professional?

Not always. If your crypto taxes are simple, say you only bought and sold on one exchange, tax software may be enough. If you used DeFi, multiple wallets, staking or mining, a CPA or enrolled agent with crypto experience can help you avoid costly mistakes.

Sources

Disclaimer: This article is for general educational purposes only and is not tax, legal or financial advice. Crypto taxes depend on your personal situation, and tax laws and IRS guidance change. Figures shown are US federal amounts as of the dates noted; state taxes may also apply. Please consult a qualified tax professional, such as a CPA or enrolled agent, before making decisions or filing your return.

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