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Calculate your estimated capital gains tax for cryptocurrency trades. Supports Short-Term vs. Long-Term holding periods.
Step-by-step breakdown of the underlying equations.
⚠️ If you wait until the 1-year mark, your tax rate could drop from 22% to approx. 15%, saving you significant capital.
The Crypto Tax Estimator calculates your estimated capital gains tax liability for cryptocurrency trades. It accounts for short-term vs. long-term holding periods and applies the appropriate tax rates based on your income bracket.
Use this to understand your tax exposure before selling, plan for tax-efficient exits, and decide whether to wait for long-term capital gains treatment.
Scenario: Jamie bought 0.5 BTC at $30,000 and wants to sell at $65,000. They're in the 22% tax bracket. They've held for 8 months (short-term).
Note: This is an estimate. Actual taxes depend on your total annual income, other gains/losses, state taxes, and deductions. Consult a tax professional for personalized advice.
The IRS treats cryptocurrency as property, not currency. This means every time you sell, trade, or spend crypto, it's a taxable event that triggers capital gains or losses. You must report gains on Form 8949 and Schedule D. Even swapping one crypto for another (e.g., BTC to ETH) is taxable.
Short-term gains (assets held less than 1 year) are taxed as ordinary income at your marginal tax rate (10-37%). Long-term gains (held 1+ year) get preferential rates: 0%, 15%, or 20% depending on your income. For high earners, there's also a 3.8% Net Investment Income Tax. Holding over a year can dramatically reduce your tax burden.
Cost basis is what you paid for the crypto, including purchase price plus any fees. For multiple purchases, you can use FIFO (First In, First Out), LIFO (Last In, First Out), or Specific Identification methods. FIFO is the default. Keep detailed records of every purchase including date, amount, and price paid.
Yes! Capital losses can offset capital gains dollar-for-dollar. If losses exceed gains, you can deduct up to $3,000 against ordinary income ($1,500 if married filing separately). Excess losses carry forward to future years. Note: The wash sale rule (which prevents repurchasing within 30 days for stocks) doesn't currently apply to crypto.
Non-taxable events include: buying crypto with fiat, transferring between your own wallets, gifting crypto (up to $18,000/year without gift tax filing), and donating to qualified charities (you may get a deduction). Receiving crypto as income, staking rewards, mining rewards, and airdrops ARE taxable as ordinary income at receipt.