Free US Crypto Tax Calculator

In the United States, the Internal Revenue Service (IRS) treats cryptocurrency as property, not currency. This means every time you sell, exchange, or spend cryptocurrency, you trigger a taxable event. The profit or loss — the difference between your cost basis (what you paid, including fees) and your sale proceeds — is a capital gain or loss.

Short-term vs. long-term. If you held the crypto for 12 months or less before selling, your gain is short-term and taxed at your ordinary income tax rate (10% to 37% depending on your income and filing status). If you held it for more than 12 months, your gain qualifies for preferential long-term capital gains rates of 0%, 15%, or 20%, based on your taxable income and filing status.

Net Investment Income Tax (NIIT). High earners may also owe an additional 3.8% Net Investment Income Tax on their capital gains. The NIIT applies if your modified adjusted gross income exceeds $200,000 for single filers, $250,000 for married filing jointly, or $125,000 for married filing separately.

Losses. If your crypto sales result in a net capital loss for the year, you can deduct up to $3,000 of that loss against ordinary income ($1,500 if married filing separately). Any unused loss carries forward indefinitely to offset future capital gains.

What counts as a taxable event? Selling crypto for fiat, trading one crypto for another, using crypto to buy goods or services, and earning crypto from staking, mining, or forks can all create tax obligations. Keeping accurate records of every transaction — including the date, amount, cost basis, and sale price — is essential.

Cost basis methods. The IRS allows you to choose which cost basis method to use when disposing of crypto. First-In, First-Out (FIFO) is the default and assumes you sell the crypto you acquired earliest. Specific Identification lets you choose which units to sell, which can minimize your tax liability if you track each lot's cost basis carefully. You must be consistent in your chosen method and maintain detailed records.

Airdrops, hard forks, and staking. Cryptocurrency received from an airdrop or hard fork is generally treated as ordinary income at its fair market value on the day you receive it. Income from staking rewards is also typically taxed as ordinary income when received. These amounts then become your cost basis for future capital gains calculations when you eventually sell or exchange the crypto.

How to report. Crypto capital gains and losses are reported on IRS Form 8949 and summarized on Schedule D of your Form 1040. You must report every disposal, even if the gain is small or the exchange did not send you a tax form. Brokers are now required to issue Form 1099-DA for certain transactions, but you remain responsible for accurate reporting. If you fail to report crypto income, you may face penalties, interest, and potential audit risk.

Wash sale rule. Unlike stocks, the wash sale rule does not currently apply to cryptocurrency. This means you can sell crypto at a loss to harvest the tax loss and immediately repurchase the same asset without losing the ability to claim the loss. However, this rule may change in the future, so it is advisable to consult a tax professional before relying on this strategy.