A unique token, often representing art or membership. Sales are capital transactions; some NFTs may be treated as collectibles with a higher long-term rate.
NFT purchases with crypto are two events: a disposal of the crypto used to pay and an acquisition of the NFT. Sales are capital transactions. The IRS has proposed treating some NFTs as collectibles, which carries a 28 percent maximum long-term rate. Royalties received by creators are ordinary income.
Yes, as capital losses when you sell or otherwise dispose of the NFT. Holding a worthless NFT is not a loss until disposed of.
Last reviewed September 10, 2026. Tax rules change; confirm current law before acting.
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