Depending on your specific circumstances, cryptocurrency can be taxed as long-term capital gains, short-term capital gains, or ordinary income.
Crypto tax rates breakdown
Ordinary income tax: If you earn cryptocurrency — whether through your job, mining, staking, or airdrops — you’ll recognize ordinary income subject to income tax.
This can range from 10% - 37% depending on your income level.
Meanwhile, cryptocurrency disposals are subject to capital gains tax.
Examples of disposals include selling crypto, trading your crypto for other cryptocurrencies, or making a purchase with crypto.
Long-term capital gains tax: If you’ve held cryptocurrency for more than a year, your disposals will be subject to long-term capital gains tax.
This ranges from 0%-20% depending on your income level.
Short-term capital gains tax: If you’ve held your cryptocurrency for less than a year, your disposals will be subject to short-term capital gains tax.
For tax purposes, this is treated the same as ordinary income and can range from 10% - 37% depending on your income level.
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