Cryptocurrency Tax Guide: How to Calculate and Report Your Crypto Gains

Cryptocurrency Tax Guide

Cryptocurrency is taxable property according to the IRS. Every transaction (buy, sell, trade, reward) creates taxable event. Calculate gains by subtracting cost basis from sale price. Short-term gains (held <1 year) are taxed as ordinary income (up to 37%). Long-term gains (held >1 year) get favorable rates (0%-20%). Use FIFO for cost basis. Mining and staking rewards are taxable income at fair market value on receipt date. Maintain detailed transaction records. Use crypto tax software to calculate automatically. Report on Schedule D with 1040.