How Much Tax on Crypto Gains? 2026 Rates and Brackets Explained

The amount you pay in crypto taxes depends on two things: how long you held the asset, and how much total income you have. Here are the exact numbers.

Short-term capital gains rates (held less than 1 year)

Short-term crypto gains are taxed at your ordinary income tax rate. For the 2025 tax year:

If you bought BTC in March 2025 and sold in November 2025, the gain is short-term and lands in one of these brackets.

Long-term capital gains rates (held more than 1 year)

Hold for at least 366 days and you get preferential rates:

Yes, there's a 0% bracket. If your total taxable income (including crypto gains) stays below $48,475 as a single filer, you pay nothing on long-term gains.

Net Investment Income Tax (NIIT)

If your modified adjusted gross income exceeds $200,000 (single) or $250,000 (married filing jointly), you may owe an additional 3.8% on investment income, including crypto gains.

How to calculate your crypto tax

Here's a worked example:

Scenario: You bought 1 ETH for $2,000 on January 15, 2024. You sold it for $3,500 on June 10, 2025. Your other income is $75,000.

1. Gain: $3,500 - $2,000 = $1,500
2. Holding period: 17 months (long-term)
3. Tax rate: 15% (your total income puts you in the 15% long-term bracket)
4. Tax owed on this gain: $1,500 × 15% = $225

Use our Profit Calculator to run these numbers for your actual positions, and the Tax Impact Preview for your full portfolio.

Special situations

Staking and mining income

This is taxed as ordinary income at the rates in the first table. The fair market value at the time you receive the rewards is your taxable amount. Track it with the Staking Calculator.

DeFi yield

Also ordinary income. If you earned 5% APY on a lending platform, that yield is income at receipt.

Airdrops

Income at the fair market value when the airdrop hits your wallet. If the token has no market value at receipt, some argue the income is $0 — but this is a gray area.

NFTs

Same rules as crypto. If you bought an NFT for 0.5 ETH and sold it for 2 ETH, the gain is the USD value difference at the time of each transaction.

Strategies to reduce your crypto tax bill

1. Hold for more than one year

The difference between 37% and 15% is massive. Patient holders are rewarded.

2. Harvest losses

Use the Tax Loss Harvesting tool to find positions with unrealized losses. Selling them locks in the loss as a deduction. Just check the Wash Sale Calculator first.

3. Use the 0% bracket

If your income is low enough, long-term gains may be tax-free. Plan your sells accordingly.

4. Offset gains with losses

Losses from crypto can offset gains from crypto. Net losses up to $3,000 can offset ordinary income too.

5. Consider a DCA approach

Dollar-cost averaging creates multiple tax lots with different holding periods and cost bases. This gives you more flexibility when choosing which lots to sell. Use the DCA Calculator to model this.

How fees affect your taxes

Exchange fees, gas fees, and network fees generally add to your cost basis. Higher cost basis means lower gains. Use the Exchange Fee Calculator and Gas Estimator to track these costs — they directly reduce your tax bill.

Conclusion

For most crypto holders, the biggest lever is holding period. Pushing past the one-year mark drops your rate dramatically. Beyond that, active loss harvesting and cost basis optimization can save thousands. Use the Tax Impact Preview to see your estimated liability, and plan accordingly. The numbers above apply to the 2025 tax year — file by April 15, 2026.

*This is educational information, not individualized tax advice.*