Crypto Donations: How to Reduce Taxes! [US Guide for 2024] (2024)

How to report a crypto donation?

Crypto donations have to be reported on your taxes, proving that the donation was made to a qualified charitable organization.

In order to generate reports, you have to track your crypto donations. You can import your crypto donations into CoinTracking manually or automatically from the exchange you used to make the transaction. Currently, you can import trades from 110+ exchanges and wallets, making it easy to report donations.

How to Donate Crypto Through The Giving Block

Since launching in 2018, The Giving Block has helped crypto donors make secure charitable donations of their assets to thousands of organizations.

Many of these donors have reduced the capital gains taxes paid on their crypto, which can add up to as much as 30% when you factor in federal, state and net investment taxes.

Follow these steps to make the most impactful and tax-efficient charitable crypto donation in 2024:

1. Choose the right asset.

To avoid paying the long-term capital gains tax on your donated crypto, choose an asset that you have held for at least one year.

2. Donate before the deadline.

Each year, the deadline to make charitable contributions is December 31. Make a calendar reminder at least one week ahead of the deadline so you don’t forget.

3. Pick a registered 501(c)3 charity.

It’s essential that you give to a 501(c)3 organization if you want a tax deduction for your contributions. Except in specific circ*mstances, donations to 501(c)4 organizations are not tax-deductible.

4. Decide how much to give.

Charities that use The Giving Block’s crypto donation form allow their donors to see the fair market value of the crypto amounts they select in USD.

5. Give crypto and save your donation receipt.

Follow the prompts to complete your donation, and be sure to include a working email address in order to receive a donation acknowledgment letter.

Today, thousands of 501(c)3 charitable organizations accept cryptocurrency donations with The Giving Block.

To make a tax-efficient cryptocurrency donation, find a cause to support on The Giving Block’s donor marketplace.

Crypto donation taxes in other countries

Crypto donation taxes in Canada

In Canada, crypto investors can get a tax credit based on the amount they donate to cryptocurrencies.

If investors donate up to $200 in crypto, they can get a tax credit of 15%, while for any amount over that, the tax credit increases to 29%.Discover more about crypto taxes in Canada.

Crypto donation taxes in Australia

In Australia, investors can’t claim a tax deduction from their donation if the organization isn’t an eligible donating recipient. However, investors won’t pay capital gains over the amount donated since that’s not classified as a disposal (e.g., sale of cryptocurrency). Learn more about crypto donation and taxes from our Australia crypto tax guide.

Crypto donation taxes in the UK

In the UK, investors who donate cryptocurrencies can claim an income tax benefit based on the fair market value of their holdings, but there are certain requirements they have to follow to not benefit from this tax break and not pay capital gains taxes. Discover more about crypto donation taxes in our UK crypto taxes guide.

How can I avoid paying taxes on Bitcoin?

Donating Bitcoin or crypto is one of the best legal ways to avoid paying capital gains tax and get a tax deduction. Moreover, you can also employ crypto tax loss harvesting strategies, where you sell one of your portfolio positions at a loss to offset the gains you had in other positions.

Additionally, you can take crypto loans, hold crypto for more than 12 months to get a long-term capital gains tax rate, direct crypto to Roth IRAs or other retirement plans. Take a look at our guide on how to reduce your crypto taxes for more information.