Crypto Tax Calculator 2025 – Cryptocurrency Tax Guide

Introduction

The IRS treats cryptocurrency as property, not currency. Every trade, sell, or spend is a taxable event. Profits are taxed as capital gains; losses can offset gains.

The Crypto Tax Calculator helps you calculate gains, losses, and tax owed.

Taxable Events

✅ Taxable:

• Sell crypto for USD
• Trade crypto-to-crypto (BTC → ETH)
• Spend crypto (buy coffee with Bitcoin)
• Receive staking/mining rewards
• Receive crypto as payment for work

❌ Not Taxable:

• Buy crypto with USD
• Transfer between your own wallets
• Hold (HODL) without selling

Capital Gains Tax

Short-Term (\u003c1 year): 10-37% (ordinary income rate) Long-Term (\u003e1 year): 0%, 15%, or 20%

Example:

• Bought 1 BTC @ $30,000 (Jan 2024)
• Sold 1 BTC @ $50,000 (March 2025)
• Holding period: 14 months
• Gain: $20,000
• Tax: $20,000 × 15% (long-term) = $3,000

Cost Basis Methods

FIFO (First In, First Out)

Assume first coins bought are first sold.

Example:

• Buy #1: 1 BTC @ $20k (Jan)
• Buy #2: 1 BTC @ $40k (June)
• Sell: 0.5 BTC @ $50k
• Basis: Buy #1 ($20k / 2 = $10k)
• Gain: $25k - $10k = $15k taxable

Specific Identification

Choose which coins to sell (best for tax optimization).

Example: Sell from Buy #2 instead

• Basis: $40k / 2 = $20k
• Gain: $25k - $20k = $5k taxable (saves $10k in gains!)

Requirement: Must identify at time of sale, keep records.

Crypto-to-Crypto Trades

Every trade is taxable, even BTC → ETH.

Example:

• Bought BTC @ $30k
• Traded for ETH when BTC = $50k
• Taxable gain: $20,000 (even though you didn't cash out)

Tax Due: Must pay tax in USD even if gains are still in crypto.

Staking & Mining

Staking Rewards: Taxed as income at fair market value when received.

Example:

• Staked ETH, received 0.5 ETH reward
• Value when received: $2,000
• Income tax: $2,000 × your tax rate
• Cost Basis: $2,000 (for future sale)

Mining: Same as staking (income when mined).

NFT Taxes

Buying NFT: Not taxable Selling NFT for profit: Capital gains Creating/Minting NFT: Potentially self-employment income

Collectibles Rate: Some NFTs taxed at 28% (collectibles rate) instead of 15-20%.

Lost or Stolen Crypto

Previously: Could deduct as theft loss Current (2018+): No deduction for theft or losses unless business

Hack/Scam: Generally NOT deductible

Tax Loss Harvesting

Unlike stocks, crypto has NO wash sale rule (yet).

Strategy:

• Sell Bitcoin at a loss
• Immediately rebuy
• Realize loss for taxes, maintain position

Example:

• Bought BTC @ $50k
• Now worth $30k
• Sell for $20k loss
• Rebuy immediately @ $30k
• Tax Benefit: Offset $20k in gains elsewhere

Reporting Requirements

Form 8949: Report each transaction Schedule D: Summarize gains/losses Schedule 1: Report staking/mining income

Exchanges issue 1099-B (starting 2025 for some), but YOU must track cost basis.

Common Mistakes

❌ Not Reporting Crypto-to-Crypto: IRS knows you traded (Coinbase reports) ❌ Forgetting Staking Income: Taxable when received, not when sold ❌ No Record Keeping: Can't defend cost basis without records ❌ Assuming Exchanges Report Basis: They often don't—you must calculate

FAQ

Q: What if I lost my wallet password? A: Generally not deductible. Keep records in case IRS questions.

Q: Do I report if I only lost money in crypto? A: Yes, report losses to offset other gains.

Q: Can I deduct crypto donations? A: Yes, to qualified charities. Donate appreciated crypto to avoid cap gains + get deduction.

Q: What about DeFi? A: Every swap, liquidity add/remove, yield farming event is taxable. Track obsessively.

Related Calculators

• Capital Gains Tax: /calculator/075-capital-gains-tax-calculator-2025
• Tax Loss Harvesting: /calculator/114-tax-loss-harvesting-calculator-2025

Conclusion

Crypto taxes are complex but unavoidable. The IRS is aggressively enforcing compliance—Coinbase, Kraken, all major exchanges report your activity.

Use the Crypto Tax Calculator and software like CoinTracker or Koinly to track transactions. Keep detailed records. When in doubt, consult a crypto-savvy CPA. Penalties for non-compliance are steep.