The default cost basis method: when you sell part of a holding, the oldest units are treated as sold first. Applies per wallet or account for crypto since 2025.
FIFO is the default. HIFO sells the highest-basis lot first to minimize gain. Both are forms of specific identification, which requires records showing the lot chosen at the time of sale.
FIFO usually sells your lowest-basis, longest-held lots first, which produces larger gains in a rising market but more long-term treatment. It is what applies automatically when you do not identify lots.
Yes, for future sales, by identifying lots at the time of each sale with adequate records. You cannot change past sales.
Source: Treas. Reg. 1.1012-1(j)
Last reviewed September 17, 2026. Tax rules change; confirm current law before acting.
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