The holding period that decides the rate on a sale: one year or less is short-term and taxed as ordinary income; more than one year is long-term and taxed at 0, 15, or 20 percent. The clock starts the day after purchase.
Short-term: held one year or less, ordinary rates up to 37 percent. Long-term: held more than one year, 0, 15, or 20 percent, plus the 3.8 percent net investment income tax above the thresholds in both cases.
The difference can be 15 points or more of rate on the same gain. For crypto, the per-wallet lot rules decide which lot is sold and therefore which holding period applies, so lot selection is a rate decision.
No. Transfers between your own wallets are not sales; the original purchase date carries over.
Source: IRC 1(h); IRC 1222
Last reviewed September 17, 2026. Tax rules change; confirm current law before acting.
A confidential consultation. Tell us what you have, and we will tell you what applies and what it costs.
Hourly billing, estimated up front, with a deposit applied to the work.
Fill this out and we will reach out to schedule your consultation.
