crypto 2026-04-15
Crypto Tax-Loss Harvesting
Use crypto volatility to capture losses without giving up market exposure.
Tax-loss harvesting (TLH) means selling at a loss to offset gains, then reinvesting in something similar.
How TLH Works
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Bought 1 BTC at $80,000
Currently $60,000 (paper loss $20,000)
Sell BTC: realize $20,000 loss
Buy ETH or different BTC product immediately
Use loss to offset gains elsewhere
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Wash Sale Rules
For stocks, the IRS wash sale rule disallows the loss if you buy "substantially identical" security within 30 days. As of 2026, the wash sale rule does not apply to crypto in the US — though legislation has been proposed.
Income Offset (US)
- Capital losses offset capital gains
- Up to $3,000/year of net capital losses offsets ordinary income
- Excess carries forward indefinitely
Tracking
Tools: Koinly, CoinTracker, ZenLedger.
When to Harvest
- Year-end review (Oct-Dec)
- After large drawdowns
- When realizing gains elsewhere
Common Mistakes
- Forgetting basis tracking
- Mixing wallets without consolidating
- Ignoring transfer fees
- Assuming wash sale exemption is permanent