As reported by Bijié Wǎng, the end of 2025 is approaching, and investors are urged to reassess their tax and accounting strategies to optimize financial health. With the recent sharp decline in the crypto market, tax loss harvesting—selling underperforming assets to offset capital gains—has become a key consideration. The decentralized and volatile nature of digital assets, combined with fragmented exchange and wallet systems, adds complexity to this strategy. Investors are advised to identify and sell assets trading below cost basis, accurately track cost bases, and confidently reinvest if desired. Notably, crypto lacks the wash-sale rule, allowing immediate repurchase of sold assets. As the IRS introduces new reporting requirements, including the 1099-DA form, investors must take responsibility for calculating cost bases and holding periods. Accurate reporting is essential to avoid penalties and optimize tax outcomes in 2026.
Year-End Tax Loss Harvesting Strategy Gains Urgency for Crypto Investors
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Summary
As 2025 nears its end, crypto investors are rushing to adjust tax strategies amid a bearish market and shifting altcoins to watch. Tax loss harvesting—selling losing positions to offset gains—has become urgent. With no wash-sale rule in crypto, investors can repurchase assets immediately. The fear and greed index remains low, but tax rules are tightening. The IRS now requires 1099-DA forms, pushing investors to track cost bases and holding periods accurately. Proper reporting is key to avoiding penalties and securing better tax outcomes in 2026.
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