Crypto Tax Calculator
Calculate capital gains, losses, and tax liability for your crypto transactions
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Understanding Crypto Taxes
In most countries, cryptocurrency is treated as property, not currency. This means every crypto transaction can trigger a taxable event. Understanding when and how much you owe is crucial to staying compliant.
Taxable Events
- • Selling crypto for fiat (USD, EUR, etc.)
- • Trading one crypto for another (BTC → ETH)
- • Using crypto to buy goods/services
- • Converting crypto to stablecoins
- • Mining rewards
- • Staking rewards
- • Airdrops (free tokens)
- • Earning interest on crypto
- • Salary paid in crypto
- • Buying crypto with fiat
- • Transferring between your own wallets
- • HODLing (just holding, not selling)
- • Receiving crypto as a gift (for the recipient)
- • DeFi yield farming
- • Liquidity pool rewards
- • NFT sales
- • Margin/futures trading
- • Hard forks (varies by country)
Short-term vs Long-term Capital Gains
- • Held for 1 year or less
- • Taxed as ordinary income
- • US: 10-37% depending on income
- • Higher tax rate
- • Held for more than 1 year
- • Preferential tax treatment
- • US: 0-20% depending on income
- • Lower tax rate (big savings!)
Cost Basis Methods Explained
FIFO (First In, First Out)
The first coins you bought are the first ones you sell. Most common method. Easy to calculate. Often results in higher taxes if you bought low early on.
LIFO (Last In, First Out)
The most recent coins you bought are sold first. Can reduce short-term gains if recent purchases were at similar prices to sale price.
HIFO (Highest In, First Out)
Sell the coins with the highest purchase price first. Minimizes capital gains, maximizes tax efficiency. Best for reducing tax burden.
Specific ID
You manually choose which specific coins to sell. Maximum control. Requires detailed record-keeping and prior documentation.
Tax Optimization Strategies
HODL for Long-term Rates
Hold investments for >1 year to qualify for lower long-term capital gains rates (0-20% vs 10-37%). Can save 10-17% in taxes!
Tax Loss Harvesting
Sell losing positions to offset gains. Losses can offset up to $3,000 of ordinary income per year (US). Unused losses carry forward indefinitely.
Use HIFO Method
If allowed in your jurisdiction, use Highest In First Out to minimize gains. Can save thousands in taxes compared to FIFO.
Time Your Sales
Sell winners in low-income years when you're in a lower tax bracket. Defer sales to next year if expecting lower income.
Keep Detailed Records
Track every transaction with date, amount, price, and fees. Use crypto tax software (Koinly, CoinTracker, TaxBit) to automate this.
Avoid Wash Sales (US)
Don't buy back the same crypto within 30 days of selling at a loss. The loss may be disallowed. (Note: Wash sale rules may not apply to crypto yet, but be cautious.)
Common Tax Mistakes to Avoid
❌ Not Reporting Crypto Income
The IRS and tax authorities have crypto transaction data from exchanges. Failing to report can result in penalties, interest, and even criminal charges. Always report, even small amounts.
❌ Forgetting Crypto-to-Crypto Trades
Trading BTC for ETH is a taxable event! You're "selling" BTC and must calculate gains/losses on that sale. Many people miss this.
❌ Not Tracking Cost Basis
Without knowing your cost basis, you'll overpay taxes. Keep records of every purchase price, including fees. Use portfolio trackers to automate this.
❌ Missing Staking/Mining Income
Staking rewards and mining income are taxed as ordinary income at fair market value when received. Many forget to report this, thinking it's "free money."
❌ Not Setting Aside Tax Money
Crypto taxes are due even if you reinvest profits. Set aside 25-40% of gains to cover taxes. Don't get caught without cash to pay the IRS!