Crypto Tax in the United States: Property Rules, Staking Income, and Form 1099-DA
2026-09-08
General information, not tax or legal advice. US taxpayers should consult IRS guidance or an independent adviser for their situation.
For federal tax purposes, digital assets are property, not currency (IRS: digital assets overview). For 2025 onward use the digital-asset FAQs; the virtual-currency FAQs cover pre-2025 transactions (IRS: digital asset FAQs) (IRS: virtual currency FAQs, pre-2025).
The Key Distinction: Property With Two Tax Moments
Receiving coins and later disposing of them are separate moments. Earned coins are income at fair market value on receipt; a later sale produces gain or loss of proceeds minus adjusted basis. One year or less is short-term, more than one year long-term (IRS: income, basis and holding-period FAQs).
Sales, Swaps, and Spending
Selling for dollars, swapping coins, spending on goods or services, and paying a network fee in crypto each count as a disposition, reportable whether or not there is a gain. Buying with dollars and holding, or moving coins between your own wallets without a crypto fee, is not a transaction on its own (IRS: answering the digital-asset question). Answer the Form 1040 digital-asset question every year; disposals generally go on Form 8949 flowing to Schedule D, subject to IRS form instructions and exceptions.
Staking and Mining
Revenue Ruling 2023-14 holds that a cash-method taxpayer staking native proof-of-stake coins includes validation rewards in gross income in the year of gaining dominion and control, when the rewards can be sold or transferred, at fair market value (Rev. Rul. 2023-14 (PDF)). Mining and service receipts in crypto are likewise ordinary income at receipt, setting basis for later sale (IRS ruling: income principles and mining references).
Losses, Broker Reporting, and Records
Capital losses offset capital gains, with limited offsets against ordinary income plus carryforward (IRS: Publication 544). Separately, custodial platforms, hosted-wallet providers, kiosks, and certain payment processors report gross proceeds on Form 1099-DA for transactions from 1 January 2025, with basis reporting phasing in from 2026 (IRS: broker-reporting regulations). That form is information reporting only: reporting obligations can apply even when no form arrives, and gross proceeds are not your gain. Hypothetical only: a Texas resident buys 1 unit for US$4,000 plus US$40, receives US$300 of rewards when transferable, then sells only the original unit 14 months later for US$6,000, retaining the reward tokens. The US$300 is ordinary income in its year; the sale yields roughly US$1,960 of long-term gain; retained reward tokens keep their US$300 basis and own holding dates. Keep records of values, basis, and holding periods. Sources checked: 8 September 2026.
Sources and Scope
Scope: federal income tax for resident individuals holding coins as capital assets; excludes business, dealer, lending-yield, NFT-creator, charitable, gifting, and state-tax specifics.
More in our crypto tax by country series | Crypto regulation in 2026