On your tax return, via IRS Form 8949, you separately report short term and long term capital gains.
Short-term crypto gain
A short-term gain occurs when you buy and then sell or exchange a crypto asset within one year. Short-term gains are subject to your marginal tax rate — that’s the rate you pay on your income.
This rate ranges from 0% to 50% depending on your location and your total income for the year.
Long-term crypto gain
A long-term gain occurs when you buy and then sell or exchange a crypto asset after holding it for a year or longer. Long term gains are subject to a different set of tax rates, called the capital gains rate.
There may also be additional long-term state taxes. In New York, for example, the long term total rate can be as high as 31.5% (20% + 11.5% New York state rate), if you’re in the top income bracket.
For up to date information regarding this, see the capital gains on the IRS webpage.
