Cardano Taxes in 2025

Cardano’s proof-of-stake network makes it easy to earn passive ADA rewards, but every buy, sell, swap, and staking payout can create an IRS reporting duty.

Learn more: What Is Cardano?

In short, for US taxpayers: yes, Cardano is taxable. Here’s how.

How the IRS classifies Cardano

The IRS views all virtual currencies, including Cardano, as property under Notice 2014-21. Each disposal is a sale of property. ADA you earn through staking or as payment is ordinary income at the fair-market value on the receipt date.

Taxable events involving Cardano

• Selling ADA for dollars

• Swapping ADA for another coin or token

• Spending ADA on goods or services

• Receiving staking rewards, yield farming payouts, or airdrops

• Wrapping or unwrapping ADA if the blockchain treats the wrap as a new asset

• Short-term gains on ADA held one year or less follow the current ordinary-income brackets of 10% to 37%.

• Long-term gains on ADA held more than one year use the 0%, 15%, or 20% capital-gains rates.

• Net investment income tax adds 3.8% for high-income filers.

• Staking rewards and ADA wages are ordinary income when received. Selling those rewards later creates a separate capital gain or loss.

See our expert picks of the best crypto wallets.

• Date, time, and transaction hash for every ADA move

• Quantity of ADA in and out

• USD value and any fees at the time of each event

• Wallet addresses or exchange IDs to prove ownership

• Staking reward ledger showing payout dates and values

Learn where to buy Cardano.

Download your ADA transaction history, convert each trade to dollars, and list the disposals on Form 8949. Transfer the totals to Schedule D, and enter staking rewards as “other income” on Schedule 1. Attach your cost-basis records and file by the deadline.

Cardano tokens

Buying ADA sets your cost basis. Selling or swapping it creates a gain or loss equal to the difference between proceeds and basis, minus any transaction fees.

NFTs on Cardano

Minting or buying an NFT establishes basis. Selling the NFT for ADA triggers a capital gain or loss. Royalties you receive from secondary sales are ordinary income.

Token swaps

Exchanging ADA for Jupiter or other Cardano native tokens is a taxable barter. Use the fair-market value of both sides at the time of the swap to compute gain or loss.

Liquidity pools and LP tokens

Depositing ADA into a pool and receiving LP tokens counts as disposing of ADA and acquiring a new asset. Yield from the pool is ordinary income when credited. Withdrawing liquidity is another taxable event.

Cardano staking rewards

Each epoch payout is ordinary income at the ADA-USD price timestamped on receipt. When you spend or convert those rewards, you calculate a capital gain or loss from that original income basis.

Learn more about Cardano staking.

• Connect all exchanges and wallet addresses through API or public address import.

• Verify the wallet balance at year-end to catch missing transactions.

• Match internal transfers so moves between your own wallets do not show as taxable events.

• Pull token and NFT values using on-chain price oracles and market APIs, ensuring every ADA native token is priced correctly.

TokenTax automates these steps, flags discrepancies, and produces a ready-to-file Form 8949 along with income summaries.

Use our free crypto tax calculator.

• Hold ADA for more than twelve months before selling to access long-term rates.

• Harvest ADA losses in a down market to offset other crypto or stock gains.

• Use tax-advantaged accounts like a crypto IRA when possible.

• Deduct staking node expenses if you run ADA infrastructure as a business.

Cardano taxes FAQs

Do you pay taxes on staking Cardano?

Yes, you pay tax on staking Cardano because the rewards count as ordinary income on the day they hit your wallet. You will later face capital gains tax if you sell those rewarded ADA for more or less than the income basis.

How can I reduce my Cardano taxes?

You can reduce your Cardano taxes by holding ADA over a year for long-term rates, harvesting losses against gains, and deducting legitimate expenses if you operate ADA activities as a business.

How do I report staking rewards?

You report staking rewards by listing the USD value of each reward receipt as miscellaneous income on Schedule 1 or as business income on Schedule C, then reporting any later disposal on Form 8949.