Cryptocurrency and Capital Gains© | by Jeremiah Flowers
What is the cryptocurrency tax rate?
Cryptocurrency is taxed exactly like other property in the United States: every time you sell, swap, or spend crypto, you create a taxable event. Profits on coins held a year or less are added to your ordinary-income bracket (10-37%), while assets kept longer than 12 months qualify for the lower long-term capital-gains rates of 0%, 15%, or 20%.
Tokens you earn (from mining, staking, salary, airdrops, or play-to-earn games) are ordinary income the moment they hit your wallet, and each later sale or swap of those tokens triggers a separate capital-gain calculation. Airtight cost-basis records and purpose-built software (like ours at TokenTax) are essential if you want to file accurately and keep more of your hard-won crypto gains.
How much will I be taxed on crypto?
The crypto-tax rate depends on two main factors: the asset's holding period and your total taxable income. Short-term gains from crypto held a year or less are taxed at ordinary-income rates (10-37%). Long-term gains from crypto held more than a year are taxed at lower rates (0-20%). Income you receive in crypto (whether as payment, mining rewards, or staking yield) is taxed at ordinary-income rates when received.
Short-term capital gains tax for crypto
For US taxpayers, short-term capital gains apply to crypto held one year or less and are taxed as ordinary income. Rates range from 10-37%, depending on total taxable income. Short-term gains are generally higher than long-term rates, highlighting the benefit of long-term holding.
2025 short-term capital-gains tax rates (taxes due in 2026)
Rate | Single | Married filing jointly | Married filing separately | Head of household |
10% | $0–$11,925 | $0–$23,850 | $0–$11,925 | $0–$17,000 |
12% | $11,926–$48,475 | $23,851–$96,950 | $11,926–$48,475 | $17,001–$64,850 |
22% | $48,476–$103,350 | $96,951–$206,700 | $48,476–$103,350 | $64,851–$103,350 |
24% | $103,351–$197,300 | $206,701–$394,600 | $103,351–$197,300 | $103,351–$197,300 |
32% | $197,301–$250,525 | $394,601–$501,050 | $197,301–$250,525 | $197,301–$250,500 |
35% | $250,526–$626,350 | $501,051–$751,600 | $250,526–$375,800 | $250,501–$626,350 |
37% | $626,351+ | $751,601+ | $375,801+ | $626,351+ |
Long-term capital gains tax for crypto
For US taxpayers, short-term capital gains apply to crypto held one year or less and are taxed as ordinary income. Rates range from 10-37%, depending on total taxable income. Short-term gains are generally higher than long-term rates, highlighting the benefit of long-term holding.
2025 long-term capital-gains tax rates (taxes due in 2026)
Filing Status | 0% Rate (≤) | 15% Rate (≤) | 20% Rate (>) |
Single | $0 – $48,350 | $48,351 – $533,400 | $533,401+ |
Married Filing Jointly | $0 – $96,700 | $96,701 – $600,050 | $600,051+ |
Married Filing Separately | $0 – $48,350 | $48,351 – $300,000 | $300,001+ |
Head of Household | $0 – $64,750 | $64,751 – $566,700 | $566,701+ |
What crypto transactions are taxable?
Taxable crypto transactions include selling crypto for fiat, trading one cryptocurrency for another, and using crypto to purchase goods or services, , receiving crypto as payment for goods or services, crypto mining & staking rewards. airdrops and hard forks, and converting crypto to stablecoins. Each of these events can generate taxable gains or losses, depending on the difference between the asset's acquisition cost (cost basis) and sale price.
Not taxable
Certain crypto activities are not considered taxable events. These include transferring crypto between personal wallets, holding assets without selling, and gifting crypto in some cases below the annual exclusion ($19,000 per recipient for tax year 2025 filed in 2026).
Stay aware. Ask questions. Know the difference.
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