Taxes · 🇺🇸 United States
Crypto and tokenized asset taxes in the United States
Crypto is property: every sale, swap or spend is a taxable disposal. Held over one year: 0%/15%/20% federal; one year or less: ordinary income rates. States add their own income tax.
Crypto
Gains
Federal: long-term 0% / 15% / 20%; short-term at ordinary income rates (10%–37%); plus 3.8% net investment income tax above income thresholds
Holding period
Held more than one year: long-term capital gain rates (0%/15%/20%) instead of ordinary income rates
Tax-free allowance
No crypto-specific allowance; the 0% long-term bracket applies to lower taxable incomes
Losses
Capital losses offset capital gains; up to $3,000 per year against other income; unused losses carry forward without time limit. The wash sale rule (IRC 1091) covers stock and securities, so it is generally read as not applying to plain crypto.
Also
Most states tax capital gains as ordinary income at their own rates (some states have no income tax). Crypto-to-crypto swaps and paying with crypto are taxable disposals.
Income and tokenized assets
Staking, lending, yield
Staking rewards are ordinary income at fair market value when you gain control of them (Rev. Rul. 2023-14); airdrops and mining work the same way. Interest-like yield from lending or yield-bearing tokens is generally ordinary income; later sale of the reward triggers a separate capital gain or loss.
Tokenized stocks, bonds, funds
The IRS treats a tokenized stock, bond or fund unit as a 'dual classification asset': a digital asset that is also a security. Brokers report its sale on Form 1099-DA (with CUSIP and wash-sale losses), not 1099-B, except where it is cleared on a limited-access regulated network. Because it is a security, the wash sale rule can apply, and dividends or interest are taxed like those on the underlying security. Tracker certificates and offshore tokens (e.g. xStocks) have no specific IRS guidance.
Tokenized gold
No specific IRS guidance on tokenized gold (PAXG/XAUT). Physical gold is a 'collectible' with a 28% maximum long-term rate; whether a gold token counts as a collectible is open.
Filing
Tax year
Calendar year; federal return (Form 1040) normally due 15 April of the following year
Reporting
Form 1040 asks every filer whether they received or disposed of digital assets. Gains and losses go on Form 8949 and Schedule D. Custodial brokers file Form 1099-DA: gross proceeds for sales from 2025 (first forms early 2026); from 1 Jan 2026 also cost basis for 'covered' assets bought and held in the same broker account (forms early 2027). Assets bought before 2026 or moved in from your own wallet stay 'noncovered' (proceeds only). The DeFi broker rule was repealed by Congress in April 2025 (Public Law 119-5), so non-custodial DeFi front-ends do not issue 1099-DA. Foreign accounts: FBAR / Form 8938 rules may apply.
Tax authority
Watch out
- Form 1099-DA for 2025 shows proceeds without basis; you must supply your own cost basis on Form 8949 or overpay.
- Coins transferred into an exchange from your own wallet are 'noncovered' even after 2026: keep your purchase records.
- Tokenized stocks are securities, so the wash sale rule can bite there but generally not on plain crypto.
- State income tax comes on top of federal tax and differs a lot by state.
Sources
- IRS — Digital assets · irs.gov
- IRS — Instructions for Form 1099-DA · irs.gov
- House Ways and Means — DeFi broker rule repeal signed (10 Apr 2025) · waysandmeans.house.gov
- Thomson Reuters — DeFi crypto regs officially removed · tax.thomsonreuters.com
- EY — IRS finalizes Form 1099-DA and instructions · taxnews.ey.com
- Gordon Law — Crypto wash sale rule in 2026 · gordonlaw.com
Not confirmed
- Rate bands (0/15/20, 10–37%, 3.8% NIIT, $3,000 loss limit) taken from the existing summary and general knowledge; IRS digital-assets page not re-fetched this round.
- Whether tokenized gold is a 'collectible' (28% max rate): no IRS guidance found.
- FBAR treatment of foreign crypto-only accounts (FinCEN Notice 2020-2 said not yet reportable) not re-checked.
- US participation in OECD CARF: no confirmed implementation date found.
- Proposed rule moving tokenized mutual fund / money market fund reporting to 1099-DA: final status not confirmed.
Researched 2026-11-01 for private individuals resident in the United States. Information, not tax advice — rules change; check the tax authority before you file.