Question 1

How is cryptocurrency taxed in the US?

Accepted Answer

The IRS treats cryptocurrency as property. Selling crypto for fiat (USD), trading one crypto for another, or using crypto to purchase goods/services all trigger a taxable event. Short-term gains (held 365 days or less) are taxed at ordinary income rates (10%-37%). Long-term gains (held 366+ days) are taxed at preferential rates (0%, 15%, or 20%).

Question 2

What is the difference between short-term and long-term crypto gains?

Accepted Answer

Short-term gains (crypto held 365 days or less) are taxed at your ordinary income tax rate, which ranges from 10% to 37% in 2026. Long-term gains (held 366+ days) are taxed at 0%, 15%, or 20%, depending on your income. For most taxpayers, holding for over a year cuts the federal tax rate roughly in half.

Question 3

Do I owe tax if I lost money on crypto?

Accepted Answer

You can use capital losses to offset capital gains dollar-for-dollar. If your losses exceed your gains, you can deduct up to $3,000 per year against ordinary income ($1,500 if married filing separately) and carry forward remaining losses to future years. This is called tax-loss harvesting.

Question 4

What is the Net Investment Income Tax (NIIT)?

Accepted Answer

The NIIT is a 3.8% surtax on investment income (including crypto gains) for taxpayers with modified AGI above $200,000 (single) or $250,000 (married filing jointly). It applies to the lesser of your net investment income or the amount by which your MAGI exceeds the threshold.

Question 5

Do I need to report crypto transactions to the IRS?

Accepted Answer

Yes. Starting in 2026, crypto exchanges issue Form 1099-DA to report your transactions to the IRS. You must report all crypto sales on Form 8949 and Schedule D, even if you sold at a loss. Failing to report can result in penalties, interest, and audit.

Question 6

Is this crypto calculator free?

Accepted Answer

Yes, 100% free with no signup, no API limits, and no data upload. All calculations run entirely in your browser. Your financial data never leaves your device.

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