Crypto tax 2026 starts with one rule that drives everything else: the IRS treats cryptocurrency as property, not currency (Notice 2014-21). That means each time you sell, trade, or spend Bitcoin, you trigger a taxable disposal and a capital gain or loss.
How is crypto taxed in 2026?
Crypto is taxed as property. You owe tax on the gain (sale value minus your cost basis), not on the coins you simply hold.
Three common actions are taxable disposals:
- Selling crypto for US dollars.
- Trading one coin for another (for example, Bitcoin for Ethereum).
- Spending crypto to buy goods or services.
Buying crypto with dollars and holding it is not taxable. Moving coins between your own wallets is not a disposal either. The tax lands when you part with the asset.
What are the 2026 crypto capital gains rates?
The rate depends on your holding period. Crypto held one year or less is taxed at short-term (ordinary income) rates. Crypto held more than one year is taxed at long-term rates of 0%, 15%, or 20%.
| Rate | Single filer taxable income | Holding period |
|---|---|---|
| 0% | up to $49,450 | more than 1 year |
| 15% | $49,450 to $545,500 | more than 1 year |
| 20% | above $545,500 | more than 1 year |
| Ordinary rates | any amount | 1 year or less |
Married-filing-jointly thresholds are higher. Short-term gains follow your regular bracket, so the same Bitcoin profit can be taxed very differently depending on whether you sold at day 364 or day 366. See the full schedule in our 2026 capital gains tax guide.
Run your own number through the US capital gains calculator to see which band your gain falls in.
When is crypto taxed as income?
Some crypto is taxed as ordinary income the moment you receive it, before any later capital gain. Crypto received as mining rewards, staking rewards, airdrops, or payment for work is ordinary income at its fair market value on the date received.
That value also becomes your cost basis. If you later sell those coins, you calculate a separate capital gain or loss from that basis. So staking and similar rewards can be taxed twice over their life: once as income, then again as a gain when you dispose of them.
What is Form 1099-DA?
Form 1099-DA (Digital Asset Proceeds From Broker Transactions) is the new IRS form crypto brokers use to report your activity. It is the digital-asset cousin of the 1099-B that stock brokers issue.
Here is what it covers in two distinct phases:
- Gross proceeds: brokers must report gross proceeds for transactions on or after January 1, 2025. The first 1099-DA forms were issued in early 2026 for tax year 2025.
- Cost basis: basis reporting applies to covered digital assets acquired on or after January 1, 2026. 2025 was a transition year (proceeds only, usually no basis), and the IRS granted brokers good-faith penalty relief.
Because 2025 forms often show proceeds with no basis, the IRS may see a large sale figure with no cost subtracted. You still have to supply your own basis records so you are not taxed on the full proceeds.
Separately, every Form 1040 has a digital-asset question that you must answer yes or no. Answer it even if you only bought and held.
When does broker reporting start?
The rollout happens in stages. The chart below maps the three milestones that define crypto tax 2026 paperwork.
Key takeaway: 2025 forms generally show proceeds only, while assets you buy from January 1, 2026 onward will eventually carry basis on the form too.
What to do before you file
- Keep your own basis records. 2025 forms may lack basis, so track what you paid for every coin.
- Separate income from gains. Log staking, mining, and airdrops at fair market value on the date received.
- Answer the 1040 question. Mark yes or no honestly, even if you only held.
- Estimate the bill. Use the crypto profit/loss calculator, then check your bracket against the 2026 tax brackets.