CoinTracker's official crypto tax guide for the 2024 tax year is here — so you can file with confidence.The IRS is watching crypto more closely than ever. If you traded, staked, or earned crypto in 2024, you’ll need to report it.→ Is crypto taxable? Do you have to pay taxes on crypto in the U.S.?Yes. The IRS classifies crypto as property, just like stocks or real estate. That means anytime you sell, trade, or spend crypto, you may owe taxes.If you profit from a sale or trade, you pay capital gains tax. If you earn crypto through staking, mining, or airdrops, it’s taxed as ordinary income based on the value when received.Not reporting can lead to IRS audits, fines, or even legal action—so it’s critical to get it right.→ What is a taxable event?A taxable event occurs when you dispose of crypto or earn it as income. Common taxable events include:➤ Selling crypto for fiat – Cashing out to USD, EUR, etc.➤ Trading one crypto for another – Even swapping stablecoins counts.➤ Spending crypto – Buying coffee with Bitcoin? That’s a taxable event.➤ Earning staking, mining, or airdrop rewards – The IRS considers these taxable income.➤ Receiving crypto from a hard fork – If a blockchain splits and you get new tokens, it’s taxable.Every taxable event requires calculating cost basis, proceeds, and capital gains/losses—which is why tracking transactions is key.→ Short-term vs. long-term capital gainsThe amount you owe in taxes depends on how long you hold your crypto before selling:🔹 Short-term capital gains – If you sell crypto within a year, gains are taxed as ordinary income (10%–37%).🔹 Long-term capital gains – If you hold for more than a year, you qualify for lower tax rates: 0%, 15%, or 20% depending on income.Example:You buy 1 BTC for $30K and sell it 6 months later for $40K → Short-term tax (higher rate)You buy 1 BTC for $30K and sell it 2 years later for $40K → Long-term tax (lower rate)Holding longer = potential lower taxes.→ Reporting losses, scams, and theft❓ Do you have to report crypto on taxes if you lost money?Yes. The IRS requires reporting ALL crypto transactions, even losses. But losses can work in your favor by reducing your tax bill.✔ Capital losses can offset capital gains → If you lost money on trades, you may pay less tax.✔ Up to $3,000 in excess losses can be deducted from regular income (wages, business income, etc.).✔ Carry forward losses indefinitely to offset future gains.Example:You made $5K in crypto gains but lost $2K on a bad trade. You only pay tax on the net $3K gain.🚩 Hacks, bankruptcies, and scams? You may be able to deduct those losses, but tax treatment depends on specifics. Consult a tax pro for guidance.→ Taxable income from crypto activitiesIf you earned crypto in any way, it’s likely taxable income when received.📌 Common taxable income sources:➤ Staking & mining rewards➤ Airdrops & hard forks➤ Liquidity provider rewards (DeFi)➤ Play-to-earn (P2E) crypto gaming➤ Payments for freelance work or services📌 How is it taxed?Crypto income is taxed as ordinary income based on its fair market value (FMV) when received.Example:You stake ETH and receive 0.5 ETH in rewards when it’s worth $1,500.That $1,500 is taxable income, just like getting paid in cash.🔹 If you sell or trade the crypto later, you owe capital gains tax on any profit.→ Tax-exempt and non-taxable crypto transactionsNot everything is taxable. Some crypto transactions are tax-free, including:✔ Buying crypto with fiat – Purchasing BTC with USD? Not taxable (until you sell).✔ Transferring crypto between wallets you own – Moving assets isn’t taxable, but track cost basis.✔ Gifting crypto (under $19K in 2025) – No taxes for the recipient; donor may need to file a gift tax return.✔ Donating crypto to a 501(c)(3) charity – Deductible based on FMV at the time of donation.Example:You transfer ETH from Coinbase to your hardware wallet → NOT taxable.You send a friend $500 in BTC as a gift → NOT taxable (unless over IRS limits).→ DeFi taxation: What you need to knowThe IRS is paying more attention to DeFi—and many transactions are taxable.🔹Taxable DeFi transactions:➤ Swaps on DEXs (@Uniswap, @PancakeSwap) = taxable trades➤ Providing liquidity = Potential taxable event➤ Borrowing against crypto collateral = NOT taxable, but liquidations can be➤ Earning yield, farming rewards, or airdrops = Taxable incomeExample:You trade ETH for wETH on Uniswap → Taxable tradeYou provide liquidity on Curve and earn CRV tokens → Taxable income→ Crypto tax filing made simpleFiling doesn’t have to be complicated.✔ Track transactions effortlessly across 500+ wallets & exchanges✔ Auto-generate IRS-ready tax reports✔ File seamlessly with @turbotax, @HRBlock, or your CPANo stress, no surprises—just crypto tax clarity.📖 Explore our entire 2025 Crypto Tax Guide & stay compliant → https://t.co/ViTPkfXQ6V