Crypto capital gains tax applies every time you sell, trade, or spend a digital asset for a profit. As of July 2026, no Trump executive order and no signed law have removed this tax, despite loud promises from the administration.
Trump crypto capital gains tax proposals have moved through the White House, Congress, and prediction markets for over a year. This guide explains if crypto is taxed as capital gains the same way today as always, which Trump-era proposals are real law, and how to avoid capital gains tax on crypto using IRS-approved methods.
Key Takeaways
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What Is Crypto Capital Gains Tax?
Crypto capital gains tax is the federal and state tax owed on profit from selling, trading, or spending a digital asset. The IRS treats cryptocurrency as property, not currency, under Notice 2014-21. That single classification is why Bitcoin, Ethereum, and every altcoin follow the same rules as stocks.
How Crypto Profits Are Taxed in the US
Crypto profits get taxed based on your holding period. Sell within one year, and the IRS taxes your gain as ordinary income, up to 37%. Sell after holding longer than a year, and you qualify for the lower long-term rate of 0%, 15%, or 20%.
A cost basis is the amount you originally paid for the crypto, plus transaction fees. The IRS calculates your taxable gain by subtracting cost basis from your sale price, under Publication 551. Get the basis wrong, and you either overpay or invite an audit.
Is Crypto Taxed as Capital Gains? Key Rules Explained
Crypto is taxed as capital gains. Every disposal, meaning every sale, trade, or purchase made with crypto, counts as a taxable event under IRS Notice 2014-21.
- Selling crypto for US dollars: taxable
- Trading one crypto for another, like BTC for ETH: taxable, since the IRS treats it as selling BTC and buying ETH
- Spending crypto on goods or services: taxable at fair market value on the day of the transaction
- Receiving staking or mining rewards: taxed as ordinary income at receipt, then capital gains again when sold
- Holding crypto in your wallet: not taxable
- Moving crypto between your own wallets: not taxable
| Example: You bought 1 ETH for $2,000 in 2023. In 2026, you swap it for a different token when ETH is worth $5,000. You owe capital gains tax on the $3,000 gain, even though you never touched a US dollar. |
Trump Crypto Capital Gains Tax Proposal
The Trump crypto capital gains tax proposal is a mix of executive orders, a 166-page White House policy report, and separate bills moving through Congress at very different speeds.
Trump signed an executive order in January 2025 revoking prior crypto policy and creating a Presidential Working Group on Digital Asset Markets. By August 2025, that group published its full roadmap. None of it eliminated capital gains tax on crypto.
Overview of Proposed Changes and Tax Rates
No proposal has cut the crypto capital gains tax rate itself. The 2026 rate schedule, 0%, 15%, and 20% for long-term gains, comes from routine IRS inflation adjustments under Rev. Proc. 2025-32, not from a crypto capital gains tax Trump cut.
- Real, signed law: The One Big Beautiful Bill Act (P.L. 119-21), signed July 4, 2025, permanently extended TCJA income brackets but left capital gains rates untouched.
- Real, signed law: An April 2025 repeal removed the requirement for decentralized finance platforms and non-custodial wallets to file Form 1099-DA. Centralized exchanges like Coinbase still must report.
- Proposed, not law: A de minimis exemption for crypto purchases under $300 was cut from the Big Beautiful Bill and is now pushed separately by Senator Cynthia Lummis.
- Proposed, not law: The PARITY Act (H.R. 8899) would treat certain GENIUS Act-qualified stablecoins like cash for tax purposes, sparing routine transactions from gain tracking.
- Proposed, not law: The CLARITY Act (H.R. 3633) passed the House in July 2025 and cleared the Senate Banking Committee in May 2026, but sits stalled on the Senate calendar as of mid-July 2026. It addresses market structure, not tax rates.
- Unofficial: Eric Trump floated a tax exemption idea for US-based crypto projects in January 2025. It never became a bill.
The table below shows what actually changed under Trump versus what remains a proposal only.
| Change | Status | Effect on Your Taxes |
| One Big Beautiful Bill Act | Signed law, July 2025 | No change to capital gains rates |
| DeFi Form 1099-DA repeal | Signed law, April 2025 | DeFi platforms don’t report to IRS; you still owe tax |
| De minimis exemption ($300) | Proposed only | Would exempt small transactions if it passes |
| CLARITY Act | Stalled in Senate | Market structure bill, not a tax cut |
| PARITY Act | Proposed only | Would simplify stablecoin gain tracking |
None of these proposals lower your crypto capital gains tax bill today. Only enacted law counts, and right now, none of the tax-cut proposals have reached that stage.
How Trump’s Proposal Could Impact Your Portfolio
If the CLARITY Act or PARITY Act clears the Senate before the August 2026 recess, exchanges and stablecoin holders would see real, practical changes, not lower tax rates on your gains. Prediction market odds on CLARITY passage sat near 43% in mid-July 2026, down from spring highs, largely over a dispute about disclosure rules for government officials’ crypto holdings.
Treat every crypto capital gains tax headline as speculation until a bill lands on the president’s desk with a signature. Keep tracking your basis and reporting every disposal under current law regardless of what Congress debates next.
Strategies to Reduce Crypto Capital Gains Tax
Understanding that crypto is taxed as capital gains the same way it was last year is the foundation for every strategy below. You can lower your bill today through timing, loss harvesting, and account structure, all without waiting on Congress.
How to Avoid Capital Gains Tax on Crypto Legally
To avoid capital gains tax on crypto legally starts with your holding period and income timing.
- Hold over one year to drop into the 0%, 15%, or 20% long-term brackets instead of ordinary rates up to 37%
- Sell in a year when your taxable income falls under $98,900 (married) or $49,450 (single) to hit the federal 0% bracket
- Donate appreciated crypto directly to a qualified charity; you avoid the gain entirely and may deduct fair market value
- Hold long-term crypto inside tax-advantaged retirement accounts through a specialized crypto IRA custodian, deferring tax until withdrawal
- Gift crypto under the $19,000 annual exclusion to shift future gains toward a family member in a lower bracket
We worked with a client holding Bitcoin bought back in 2019. Selling the full position in one year would have pushed him into the 20% federal bracket plus California’s 13.3% top rate. Spreading the sale across two tax years kept most of the gain inside the 15% federal bracket instead, one of several advanced tax planning strategies we build around real income timing.
Tax-Loss Harvesting and Holding Period Tips
Tax-loss harvesting means selling a losing crypto position to offset gains elsewhere in your portfolio, and crypto currently holds an advantage stocks don’t get.
- Sell losing positions before December 31 to offset that year’s gains
- Rebuy the same crypto right away; unlike stocks, crypto currently has no 30-day wash sale wait, though pending legislation could change this
- Track cost basis per lot using FIFO, LIFO, or specific identification
- Deduct up to $3,000 of net losses against ordinary income each year and carry the rest forward indefinitely
| Example: A client holding both a large Solana gain and an underwater altcoin position sold the losing coin in December, offsetting most of the Solana gain and cutting the year’s tax bill by thousands, a straightforward form of reducing taxes on investment gains without touching the winning position. |
How SWAT Advisors Can Help You Manage Crypto Taxes
We are SWAT Advisors, a California-based tax advisory firm built around one goal: keeping more of your money, legally. Crypto capital gains tax rules move fast, and crypto capital gains tax headlines change weekly. We track every real change so you don’t have to guess which ones matter.
- Full crypto transaction reconciliation across exchanges, wallets, and DeFi protocols
- Cost basis calculation, plus Form 8949 and Schedule D preparation
- Advanced tax planning strategies built around California’s 13.3% top rate stacked on top of federal tax
- Multi-year sale planning aimed at reducing taxes on investment income and keeping gains inside lower brackets
- Guidance on tax-advantaged retirement accounts for long-term crypto holders
- Ongoing monitoring of Trump-era proposals, so your plan updates the moment real law changes, not when a headline does
We help California investors focused on reducing capital gains tax in California through timing, loss harvesting, and entity structure, not guesswork. Book a consultation with us today, and let our team build a crypto tax plan around your actual portfolio.
Expert Guidance on Crypto Tax Planning and Reporting
Expert guidance matters most now that Form 1099-DA reporting has started for centralized exchanges, since the IRS receives your transaction data directly from platforms like Coinbase and Kraken. A mismatch between what you report and what the IRS already has on file triggers notices fast.
We review every client’s full crypto exposure before filing season, not after. We typically recommend a check-in at least one quarter before a large planned sale, so we can apply tax-efficient savings strategies and confirm your reporting lines up with what exchanges send the IRS.
Conclusion
Crypto capital gains tax remains fully enforced under current US law, regardless of Trump-era rhetoric about eliminating it. The IRS taxes every disposal, trade, and spend of digital assets as property under Notice 2014-21, with 2026 long-term rates set at 0%, 15%, or 20%, and short-term gains taxed as ordinary income up to 37%. While the CLARITY Act, PARITY Act, and a proposed de minimis exemption sit stalled in Congress, no signed law has changed capital gains treatment for crypto.
SWAT Advisors is the right partner for investors navigating this shifting landscape. We combine hands-on crypto reconciliation with real-time tracking of every proposed law, so your tax plan reflects what is actually enacted.
We help you structure sales, harvest losses, and stay compliant with Form 1099-DA reporting ahead of deadlines, all in service of preserving investment wealth through legal, proven methods. Contact us today to schedule a consultation and build a crypto tax strategy that protects what you’ve built.
FAQs
No Trump proposal has changed the rate. 2026 federal long-term rates stay at 0%, 15%, or 20%, set by standard IRS inflation adjustments, not a tax cut.
Yes. Mining income is taxed as ordinary income at fair market value when received, then capital gains tax applies again when you sell the mined coins.
Yes. Crypto losses offset capital gains dollar for dollar, plus up to $3,000 against ordinary income yearly, with any excess carried forward.
Yes. The IRS treats every crypto-to-crypto trade as selling one asset and buying another, triggering tax on any profit at the time of the swap.
Consult us before you sell, not after. We recommend a review at least one quarter before a planned sale to structure timing and loss harvesting properly.
