The short answer: yes, probably. In the US and most developed countries, cryptocurrency is treated as property for tax purposes, which means buying, selling, earning, and spending crypto can all create tax events. This guide explains when you owe, when you don't, and what to do about it.
When You DO Owe Taxes
These events typically trigger a tax obligation:
- Selling crypto for fiat — if you sell ETH for USD and the price went up since you acquired it, the profit is a capital gain. You owe taxes on the gain.
- Trading one crypto for another — swapping ETH for BTC is a taxable event. The IRS treats it as selling ETH (capital gain/loss) and buying BTC.
- Earning crypto as income — if you earn crypto for completing tasks on RentAHuman, that's income. It's taxable at the fair market value at the time you received it — just like a paycheck.
- Spending crypto — buying a $50 item with crypto you acquired for $30 means you realized a $20 capital gain. Yes, even on coffee.
- Receiving airdrops or staking rewards — taxable as income at fair market value when received.
When You DON'T Owe Taxes
- Buying crypto with fiat and holding — no tax event until you sell, trade, or spend it.
- Transferring between your own wallets — moving ETH from MetaMask to Coinbase is not taxable (though you should keep records to prove it was a self-transfer).
- Donating crypto to charity — may be tax-deductible, not taxable (consult a tax professional for specifics).
- Holding unrealized gains — if your ETH went from $2,000 to $5,000 but you haven't sold, you don't owe anything yet.
Crypto You Earn on RentAHuman
This is especially relevant for platform users: when you complete a task and receive crypto payment, the IRS considers that ordinary income. You'll owe income tax on the USD value at the moment you received it.
Task completed: Feb 5, 2026
Payment received: 0.1 ETH
ETH price at receipt: $3,200
Income to report: $320
Later scenario — you sell the 0.1 ETH:
Sell price: $3,800
Cost basis: $3,200 (the income value)
Capital gain: $600
Additional tax: capital gains on $600How Much Will You Actually Pay?
It depends on the type of gain and your total income:
- Short-term capital gains (held less than 1 year) — taxed as ordinary income. Rates: 10–37% depending on your tax bracket.
- Long-term capital gains (held more than 1 year) — lower rates: 0%, 15%, or 20% depending on your income.
- Income from earning — taxed at your ordinary income rate plus self-employment tax (15.3%) if you're a freelancer/independent contractor.
The distinction between short-term and long-term is huge. Holding an asset for 366 days instead of 364 can cut your tax rate nearly in half. This is why many investors adopt a "hold for at least a year" rule.
What Happens If You Don't Report?
Major exchanges (Coinbase, Kraken, Binance.US) now report to the IRS. Starting in 2025, Form 1099-DA requires exchanges to report customer transactions directly. The IRS specifically asks on your tax return: "At any time during the tax year, did you receive, sell, send, exchange, or otherwise acquire any digital assets?"
Penalties for non-reporting range from 20% of the unpaid tax (negligence) to 75% (civil fraud) plus interest. Deliberate evasion is a criminal offense.
For a deeper look at how gains are calculated, see our capital gains explainer. And for practical tools to make tax season painless, check our crypto tax tracking guide.