Crypto tax rates for 2026: what you'll actually pay
The rate you pay on a crypto sale comes down to one thing you control and a few numbers the IRS sets.
The tax you owe on a crypto sale isn't one flat number. It moves with how long you held the coin, what your total income looks like for the year, and whether the crypto came to you as a purchase or as a payment. Two people can sell the same amount of Bitcoin on the same day and owe wildly different tax. Here's why, worked through with the 2026 rules and actual dollar figures.
Crypto is property, so selling it is a taxable event
The IRS treats cryptocurrency as property, the same bucket as a stock or a rental house. That one fact drives everything else. When you dispose of crypto, you have a capital gain or loss, and the tax turns on your cost basis, what you paid, against what you got back.
Disposal is broader than most people expect. Selling coin for dollars counts. Swapping one token for another counts. So does spending crypto on something real. Buy a $6 coffee with Bitcoin you picked up for $2, and you've got a $4 gain to report, coffee or not. Move coins between two wallets you own and nothing happens, because you haven't disposed of anything. If you never sell, swap, or spend all year, you generally have no capital gain to report at all.
Short-term vs long-term: the one-year line
This is the lever you actually control. The holding period, counted from the day after you bought to the day you sell, decides which rate schedule applies.
Hold for one year or less and any gain is short-term. Short-term gains get taxed at your ordinary income rate, the same brackets that hit your paycheck, topping out at 37% for high earners in 2026.
Hold for more than a year and the gain is long-term, taxed at 0%, 15%, or 20% depending on your taxable income. That gap is big. A trader who flips a coin at eleven months and a holder who waits thirteen can face rates twenty points apart on the same profit. Waiting isn't always worth it, but it's worth knowing what you're giving up.
The 2026 long-term rate thresholds
Which of the 0/15/20 rates you land in depends on your total taxable income for the year, not just the size of the crypto gain. These are the 2026 figures. Find your filing status, then see where your taxable income falls.
The gain itself counts toward your income, so a big sale can push part of it into a higher band. Say you're single with $40,000 of other taxable income and you realize a $30,000 long-term gain. The slice that fits under $49,450 is taxed at 0% and the rest at 15%. The whole gain doesn't jump to one rate just because you crossed a line.
The extra 3.8% a lot of people forget
On top of the rates above, higher earners owe the net investment income tax. It's a flat 3.8% on investment income, crypto gains included, once your modified adjusted gross income passes $200,000 if you're single or $250,000 if you're married filing jointly. Those two numbers don't adjust for inflation, so more people drift over them each year.
We'll match you with a vetted crypto-tax pro who can sort out your holding periods, income events, and carryforwards before you file. No sales pitch, just the right person for your situation.
Get matched with a crypto-tax pro →The 3.8% stacks on your capital gains rate. A single filer well into the 20% band on a long-term crypto gain effectively pays 23.8% on it once the NIIT kicks in. Short-term gains can catch the NIIT too.
Earned crypto is income, taxed twice over its life
Not all crypto shows up as a capital gain. When you receive coins as payment or reward, that's ordinary income, valued at the fair market value in dollars on the day you got it. Staking rewards, mining income, most airdrops, and getting paid in crypto for work all fall here.
Say you receive $500 worth of a token from staking in March. You report $500 of ordinary income now, at your regular rate. That $500 also becomes your cost basis. Sell the token later for $800 and you have a $300 capital gain on top, short-term or long-term based on how long you held it after receiving it. The first bite is income tax. The second is capital gains tax on the appreciation after.
A quick word on the messier corners. How and when to tax things like liquidity pool tokens, wrapped assets, and some DeFi rewards isn't fully settled, and the guidance is thin. If a chunk of your activity lives there, that's exactly where a pro earns their fee.
Losses work in your favor, in a set order
A down year has an upside. Capital losses offset capital gains dollar for dollar. If your losses run past your gains, you can deduct up to $3,000 of the excess against ordinary income like wages. Anything still left over carries forward to future years with no expiration, ready to soak up later gains or shave another $3,000 off income each year.
One rule helps crypto here, at least for now. The wash-sale rule blocks stock investors from claiming a loss if they rebuy the same security within 30 days. It does not currently apply to crypto, because the IRS doesn't treat crypto as a security. So you can sell a coin at a loss, buy it right back, and still book the loss today. Congress has floated closing this gap more than once, so treat it as a current-law opening, not a permanent one.
What changes at filing time in 2026
The forms are shifting under your feet this year. Form 1099-DA is the new broker report for digital assets, and 2026 is the first filing season it shows up. For your 2025 activity, exchanges report gross proceeds, roughly the total dollars from your sales, but generally not your cost basis yet. Cost-basis reporting phases in for assets bought starting in 2026.
That gap matters. If a 1099-DA shows your proceeds without what you paid, the IRS sees a big number with no offset, and it's on you to supply the basis so you're taxed on the actual gain, not the whole sale. Keep your own acquisition records. The separate DeFi broker rule that would have pulled decentralized platforms into this reporting was repealed in 2025, so those platforms won't be sending you a 1099-DA.
Your gains and losses go on Form 8949, then flow to Schedule D. Near the top of your Form 1040 sits the digital asset question, a plain yes-or-no about whether you received, sold, or exchanged crypto during the year. Answer it honestly. Checking no on a return that clearly involved crypto is the kind of mismatch that draws attention, especially now that exchanges are feeding the IRS the same data.