Crypto Taxes: How They Work, 2025 Rates and Rules

When you sell cryptocurrency, your profits are subject to federal capital gains tax rates of 0%, 15% or 20% if you held the crypto for more than a year, or rates of 10% to 37% if you held the crypto for less than a year. What you pay also depends on your taxable income and your tax-filing status.

How and when is crypto taxed?

Crypto is taxed when it is sold for a profit. This taxable profit is equal to the difference between your adjusted basis in the crypto and the amount you received in exchange for the virtual currency. You report the sale on your federal income tax return in U.S. dollars

IRS.gov. Frequently asked questions on virtual currency transactions. Accessed Jul 2, 2025.

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You are only taxed on cryptocurrency if you sell it, whether for cash or for another cryptocurrency. So, if you bought $100 of cryptocurrency that is now worth $200 and you still own it, you aren’t taxed.

🤓Nerdy Tip

If you exchange your crypto for other property, goods, services or for another virtual currency, your gain is still taxable.

» Calculate your crypto profit or loss

How much are crypto taxes?

How much tax you pay on crypto depends on how long you owned it before selling, as well as your taxable income and your filing status. Capital gains are subject to either short-term tax rates (if you owned the crypto for less than a year) or long-term tax rates (if you owned the crypto for more than a year).

Selling crypto for a loss or moving wallets generally won't generate tax liability.

» Estimate your potential tax bill with our free crypto tax calculator.

Short-term capital gains tax for crypto

If you own cryptocurrency for one year or less before selling, you’ll pay the short-term capital gains tax on the profit. Short-term capital gains on crypto are taxed at ordinary income tax rates. Threse rates are usually higher than long-term capital gains tax rates.

Short-term capital gains tax rates on crypto sales in 2025

Tax Rate	Single Filer	Married Filing Jointly or Surviving Spouse	Head of Household	Married Filing Separately
10%	$0 to $11,925	$0 to $23,850	$0 to $17,000	$0 to $11,925
12%	$11,926 to $48,475	$23,851 to $96,950	$17,001 to $64,850	$11,926 to $48,475
22%	$48,476 to $103,350	$96,951 to $206,700	$64,851 to $103,350	$48,476 to $103,350
24%	$103,351 to $197,300	$206,701 to $394,600	$103,351 to $197,300	$103,351 to $197,300
32%	$197,301 to $250,525	$394,601 to $501,050	$197,301 to $250,500	$197,301 to $250,525
35%	$250,526 to $626,350	$501,051 to $751,600	$250,501 to $626,350	$250,526 to $375,800
37%	$626,351 or more	$751,601 or more	$626,351 or more	$375,801 or more
Source: Internal Revenue Service

Long-term capital gains tax for crypto

If you sell cryptocurrency after owning it for more than a year, you’ll pay long-term capital gains. The rates are 0%, 15% or 20% depending on your income and filing status.

» New to crypto investing? Here's our guide to getting started

Long-term capital gains tax rates for crypto sales in 2025

Tax rate	Single	Married filing jointly	Married filing separately	Head of household
0%	$0 to $48,350	$0 to $96,700	$0 to $48,350	$0 to $64,750
15%	$48,351 to $533,400	$96,701 to $600,050	$48,350 to $300,000	$64,751 to $566,700
20%	$533,401 or more	$600,051 or more	$300,001 or more	$566,701 or more
Short-term capital gains are taxed as ordinary income according to federal income tax brackets.

Frequently asked questions

Is it easy to deal with crypto taxes myself?

It depends. It’s easier to manage if your exchange sends you the proper tax forms. Compiling the information can be time-consuming work, especially if you’ve made many trades. But crypto-specific tax software that connects to your crypto exchange, compiles the information and generates IRS Form 8949 for you can make this task easier.

Some complex situations probably require professional assistance. You might want to consider consulting a financial advisor or tax professional if:

You have many hundreds or thousands of transactions.
Your transactions are on-chain or if you used an exchange that isn’t based in the U.S.
The crypto you sold was purchased before 2016.
You just want peace of mind.

What if I sold cryptocurrency for a loss?

If you sell crypto for less than you bought it for, you can use those losses to offset gains you made elsewhere. For example:

You buy $100 of Crypto ABC and $100 of Crypto XYZ.
You later sell ABC for $75 (a loss of $25) and XYZ for $200 (a gain of $100).
Your potential taxable amount would be $75 ($100-$25).

If your losses exceed your gains, you can use the additional amount to reduce your taxable income, up to $3,000 in most cases. You can then use, or “carry over,” any remaining losses to offset gains in future years.

Will I be taxed if I change wallets?

No. Transferring cryptocurrency from one wallet you own to another you own does not count as selling it. You won’t be taxed.

» Learn more about the best crypto wallets.

Are my staking or mining rewards taxed?

Yes. The IRS considers staking rewards as income that must be reported, as well as any cryptocurrencies received through mining. Other forms of cryptocurrency transactions that the IRS says must be reported include:

Buying property, goods or services with crypto.
Receiving crypto for goods or services.
Receiving crypto after a hard fork (a change in the underlying blockchain).
Receiving an airdrop (a common crypto marketing technique).

Do I still pay taxes if I traded cryptocurrency for another cryptocurrency?

Yes. The IRS is clear about this: If you trade cryptocurrency for any other asset, including other cryptocurrencies, it’s a taxable event.

What forms do I need?

You’ll record the history for all relevant transactions on IRS Form 8949 and summarize that information on Form 1040 along with capital gains from any other investments.

» Learn more about Bitcoin and taxes