Crypto Tax Tracking Guide
Everything you need to know about cryptocurrency taxes. Understand taxable events, track your cost basis, and stay compliant.
Disclaimer
This guide is for educational purposes only and is not tax advice. Tax laws vary by jurisdiction and change frequently. Consult a qualified tax professional for advice specific to your situation.
Taxable vs Non-Taxable Events
Selling crypto for fiat
When you sell Bitcoin, Ethereum, or other crypto for USD, EUR, etc.
Trading crypto to crypto
Swapping BTC for ETH is a taxable event. You're disposing of one asset.
Spending crypto
Using crypto to buy goods or services triggers a taxable event.
Receiving staking rewards
Staking rewards are taxed as ordinary income at fair market value when received.
Mining income
Mined crypto is taxed as income when you receive it.
Airdrops
Free tokens from airdrops are taxable as income when received.
Buying crypto with fiat
Simply buying and holding crypto is not a taxable event.
Transferring between wallets
Moving crypto between your own wallets doesn't trigger taxes.
Donating crypto
Donating to qualified charities may be tax-deductible.
Gifting crypto
Generally not taxable for the giver (up to annual exclusion limits).
How Crypto Taxes Work
Capital Gains Tax
When you sell crypto for more than you paid, you have a capital gain. The tax rate depends on how long you held the asset:
- Short-term (≤1 year): Taxed as ordinary income (10-37% in the US)
- Long-term (>1 year): Lower rates (0%, 15%, or 20% in the US)
Calculating Your Gain or Loss
The formula is simple:
Capital Gain/Loss = Sale Price - Cost Basis - FeesFor example: You bought 1 BTC for $30,000 and sold it for $45,000. Your capital gain is $15,000 (minus any fees).
Key Tax Terms
Cost Basis
The original price you paid for a crypto asset, including fees.
Capital Gain
The profit when you sell crypto for more than your cost basis.
Capital Loss
The loss when you sell crypto for less than your cost basis.
Short-Term
Held for 1 year or less. Taxed at ordinary income rates.
Long-Term
Held for more than 1 year. Taxed at lower capital gains rates.
FIFO
First In, First Out - assumes oldest coins are sold first.
Record Keeping Best Practices
Good record keeping is essential for accurate tax reporting. Track these details for every transaction:
Record the exact date and time of every buy, sell, swap, or transfer.
Track what you paid for each asset, including fees.
Document the USD value at the time of each transaction.
Classify each transaction: buy, sell, swap, income, gift, etc.
How Crypto Portfolio Tracker Helps
Track All Transactions
Log every buy, sell, and swap with dates, amounts, and prices.
Calculate Cost Basis
Automatically see your average buy price for each asset.
CSV Export
Export your transaction history for tax software or accountants.
P&L Tracking
See realized and unrealized gains at a glance.
Stay Tax-Ready Year Round
Don't scramble at tax time. Track your transactions now and be prepared with accurate records.