How to Report Crypto on Taxes in 2025

Reporting your crypto taxes starts with identifying taxable events such as sales, trades, and crypto income. The IRS treats crypto as property, so transactions that involve disposing of crypto must be reported.

The key steps include calculating capital gains and losses, reporting them on Form 8949, and summarizing totals on Schedule D. Crypto income, like staking or mining, should also be reported as ordinary income.

Here’s how to file crypto taxes in five simple steps, for US taxpayers. International taxpayers can refer to our helpful country guides for further direction.

Step 1: Calculate capital gains and losses on crypto

Subtract the cost basis (what you paid, including fees) from the proceeds of each crypto transaction to determine capital gains or losses.

Learn more about crypto cost basis.

Step 2: Complete IRS Form 8949 for crypto

Use Form 8949 to list every taxable crypto transaction. Categorize transactions as short-term or long-term depending on the holding period.

Step 3: Include totals from Form 8949 on Schedule D

Transfer the totals from Form 8949 to Schedule D. This form summarizes your net short-term and long-term capital gains or losses.

Step 4: Include any crypto income

Report crypto income, including staking rewards, mining, and airdrops, as ordinary income. If earned as part of self-employment, include it on Schedule C.

Step 5: Complete the rest of your tax return

Finalize your tax return by including all income, deductions, and credits. Ensure that your crypto reporting matches your records to avoid errors.

When in doubt, consult a crypto tax professional like ours at TokenTax.

Here are the key forms for reporting crypto taxes:

• Form 8949: Reports individual crypto sales, trades, or disposals.

• Schedule D: Summarizes capital gains and losses.

• Schedule C: Reports crypto income from self-employment (e.g., mining).

• Form 1040: The main tax return form used to report income.

Yes, you must report all taxable crypto activity on your tax return, including sales, trades, or income. The IRS requires full disclosure, even for small transactions, to avoid penalties.

Even if you didn’t receive a tax form like a 1099 from an exchange, you are still responsible for accurately reporting your crypto activity.

Calculate your crypto gains with our free crypto profit calculator.

All crypto transactions, no matter the amount, must be reported to the IRS. This includes sales, trades, and income from staking, mining, or airdrops.

Transactions under $600 may not trigger a tax form from exchanges, but they are still taxable and must be included on your return.

Crypto transactions for US taxpayers are taxed based on their classification:

• Capital gains: Profits from selling, trading, or disposing of crypto are taxed as short-term or long-term gains, depending on the holding period.

• Ordinary income: Earnings from activities like staking, mining, or airdrops are taxed as income at their fair market value when received.

Keeping detailed records ensures accurate reporting for each type of transaction.

Learn more about the current tax rates for cryptocurrency.

Crypto lost to scams or inaccessible due to exchange shutdowns cannot typically be claimed as a tax deduction. The IRS allows casualty losses only for federally declared disasters.

Document the loss carefully to prevent reporting discrepancies with the IRS.

Learn more: can I deduct crypto hacks and scams from my taxes?

Crypto transactions are taxed based on their type and holding period. Profits from selling, trading, or spending cryptocurrency are treated as capital gains. If you held the asset for one year or less, it is taxed as short-term capital gains at ordinary income rates. If held for more than one year, it qualifies for long-term capital gains rates, which are typically lower.

Additionally, crypto earned through staking, mining, or airdrops is taxed as ordinary income at its fair market value when received. Detailed record-keeping is essential to determine the correct tax treatment and ensure accurate reporting to the IRS.

TokenTax makes crypto tax reporting seamless with:

• Automatic syncing of exchanges and wallets.

• Real-time tax liability tracking.

• Generation of required IRS forms like Form 8949 and Schedule D.

• Expert support for missing cost basis and complex transactions.

• Custom reports for mining, staking, and Ethereum gas fees.

How to report crypto on taxes FAQs

Will the IRS be aware if I fail to report crypto?

Yes. Exchanges often share user data with the IRS, and tools like John Doe summons help identify unreported crypto activity.

Is it necessary to report crypto transactions under $600?

Yes, all crypto transactions must be reported regardless of value. While exchanges may not issue tax forms for transactions under $600, they are still taxable.

Can I write off crypto losses?

Yes. Crypto losses can offset gains or up to $3,000 of ordinary income per year. Excess losses can be carried forward to future years.

Learn more about how to report crypto losses on your taxes.

How much crypto do you have to make to report on taxes?

There is no minimum. No matter how small, all crypto income and gains must be reported to the IRS.

How do I declare crypto on my tax return?

Report each transaction on Form 8949, summarize totals on Schedule D, and include income like mining or staking on relevant forms such as Schedule C.

What are the tax implications of staking rewards?

Crypto staking rewards are taxed as ordinary income at their fair market value when received. Keep detailed records to ensure compliance.