A program deployed on a blockchain that executes defined rules when called, including rules for trading, lending, or holding assets.
Interacting with a contract is not itself a tax event; what the contract does with your assets is. A swap contract disposes of tokens; a lending contract takes a deposit; a vault issues shares. The tax analysis follows the asset movements the contract executes, which is why every contract call has to be decoded.
Only if it moves your assets in a way that is a disposal or an income receipt. The contract call is the mechanism; the asset movements are what get taxed.
Source: IRS Notice 2014-21
Last reviewed September 18, 2026. Tax rules change; confirm current law before acting.
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