The gap between where you hold crypto and where you pay tax on it has never been more measurable. With the arrival of Form 1099-DA broker reporting in 2025 and basis reporting phasing in from 2026, the IRS now receives automated transaction data that it did not have in prior years. At the same time, state-level divergence in crypto capital gains treatment has widened sharply. Missouri became the first state in the nation to fully exempt individual capital gains from state income tax effective January 1, 2025. Washington introduced a tiered capital gains rate adding a 9.9% bracket on gains above $1 million starting in tax year 2025. Puerto Rico’s Act 60 investor program is extending its benefits through 2055 but raising its preferential rate from 0% to 4% for new applicants from January 1, 2027. These concurrent changes are producing measurable investor and business movement patterns that state revenue authorities and researchers are now tracking.
The data in 2026 covers the full spectrum of state approaches: 9 states with no broad-based personal income tax, 14 states with a flat income tax rate, states with specific capital gains deductions or preferential rates, and high-tax states where the combined federal-state tax burden on crypto gains can exceed 37% for top earners. California’s Franchise Tax Board, which taxes all capital gains as ordinary income at rates up to 13.3%, has confirmed that it imports federal crypto gain reporting and uses data matching tools. New York applies ordinary income tax rates from 4% to 10.9% to all capital gains including crypto, with no differentiation between short-term and long-term holding periods.
At KoinX, we track these state-level developments closely because the state component of a crypto investor’s tax liability can equal or exceed the federal component in high-income jurisdictions, and because investor movement driven by tax considerations is now producing real demographic and revenue data that can be measured.
This article draws exclusively from official state tax authority publications, state legislation as signed into law, official state Department of Revenue press releases and data releases, and the official Puerto Rico Incentives Code and InvestPR documentation. All rates and thresholds are verified from primary state sources.
Scope and Methodology
This article covers statistics on state-level capital gains and income tax rates applicable to crypto gains and income across all 50 US states and Puerto Rico, legislative changes enacted in 2024 and 2025 that directly affect crypto tax treatment, official revenue collection data from state Departments of Revenue where published, and the Puerto Rico Act 60 investor program structure.
State income tax rates are sourced from official state tax authority publications and official state Department of Revenue tax rate guides. The Washington capital gains tax statistics are sourced from three successive Washington State Department of Revenue news releases. The Missouri capital gains exemption is sourced from the official Missouri Department of Revenue news release. The Colorado cryptocurrency tax payment program data is sourced from the Colorado Department of Revenue official page and confirmed by Colorado Newsline reporting citing official DOR data. Puerto Rico program statistics are sourced from InvestPR official materials and the Procopio law firm summary of Act 38-2026.
The article covers rates applicable to individuals. Corporate rates and entity-level treatments are noted only where they are directly relevant to crypto investors. It does not cover city-level income taxes except where specifically noted for New York City.
US Crypto Tax by State at a Glance: Key Numbers for 2026
- Missouri became the first US state in the nation to fully exempt individual capital gains from state income tax, effective January 1, 2025, through House Bill 594 signed by Governor Mike Kehoe on July 10, 2025, allowing individuals to deduct 100% of all capital gains reported for federal income tax purposes including gains from cryptocurrency when calculating Missouri adjusted gross income, based on the Missouri Department of Revenue official news release.
- Washington State capital gains excise tax collections exceeded $560.6 million in net payments for tax year 2024, an increase from $416.6 million collected in tax year 2023, based on the Washington State Department of Revenue news release published June 5, 2025.
- Washington State enacted a tiered capital gains tax rate effective January 1, 2025 under Senate Bill 5813 signed by Governor Bob Ferguson, taxing long-term capital gains including crypto at 7% on gains up to $1 million and at 9.9% on gains exceeding $1 million, with a standard deduction of $278,000 for 2025, based on the Washington State Department of Revenue capital gains tax page.
- California’s Franchise Tax Board taxes all capital gains including crypto as ordinary income at rates from 1% to 13.3% with no preferential rate for long-term holdings, with the top 13.3% rate applying through a 12.3% base bracket plus a 1% Mental Health Services Tax on income exceeding $1 million for single filers, based on the California Franchise Tax Board as confirmed by official California tax guidance.
- New York applies ordinary income tax rates from 4% to 10.9% to all capital gains from cryptocurrency with no distinction between short-term and long-term holdings, based on the New York State Department of Taxation and Finance treatment of capital gains, as confirmed by official New York tax guidance.
- 9 states have no broad-based personal income tax as of 2026: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming, meaning crypto capital gains are not subject to state income tax in those states, though federal tax obligations remain, based on CoinTracker’s guide to states with no income tax, consistent with official state tax authority publications for each state.
- Colorado received a total of $57,211 in cryptocurrency tax payments from September 2022 through December 2024 across 78 total payments, representing approximately 0.0005% of the $11 billion in individual income tax the state collected in fiscal year 2022-23 alone, based on official Colorado Department of Revenue data cited by Colorado Newsline published April 15, 2025.
- Puerto Rico’s Act 60 investor program is being extended through 2055 under Act 38-2026 signed in March 2026, but new applicants who obtain their decree on or after January 1, 2027 will be subject to a 4% preferential rate on post-relocation capital gains, dividends, and interest rather than the current 0% rate, based on the Procopio law firm summary of Act 38-2026.
States with No Broad-Based Personal Income Tax
- Alaska has no personal income tax, meaning crypto capital gains and income from staking or mining are not subject to Alaska state income tax, based on official Alaska Department of Revenue tax structure.
- Florida has constitutionally prohibited a state personal income tax since a 1968 constitutional amendment, meaning Florida residents pay no state income tax on crypto gains or crypto income, based on the Florida Constitution Article VII, Section 5.
- Nevada has no personal income tax and does not tax personal capital gains from cryptocurrency, generating revenue primarily through sales taxes, gaming taxes, and the Commerce Tax on businesses, based on the Nevada Department of Taxation.
- New Hampshire fully repealed its tax on interest and dividend income for taxable periods beginning in 2025, meaning New Hampshire no longer collects any form of personal income tax, and capital gains including crypto gains are not subject to state tax, based on New Hampshire Department of Revenue Administration.
- South Dakota has no personal income tax and does not tax crypto capital gains at the state level, based on the South Dakota Department of Revenue official tax structure.
- Tennessee has no personal income tax and does not tax crypto capital gains at the state level following the full repeal of its Hall Tax on investment income effective January 1, 2021, based on the Tennessee Department of Revenue.
- Texas constitutionally prohibits a personal income tax following voter approval of Proposition 4 in 2019, meaning crypto capital gains and mining income are not subject to state income tax, based on the Texas Constitution Article VIII, Section 24.
- Wyoming has no personal income tax and has additionally exempted virtual currencies from property taxation under Wyoming Senate File 111, which amends the Wyoming Taxation and Revenue Act to exempt virtual currency from property tax, based on Wyoming Statutes Section 39-11-105.
Missouri: First State to Exempt Capital Gains Including Crypto
- Missouri House Bill 594, signed by Governor Mike Kehoe on July 10, 2025, makes Missouri the first state imposing an individual income tax to eliminate capital gains tax for individual filers, with the exemption effective retroactively to January 1, 2025, based on the Missouri Department of Revenue official news release.
- Under HB 594, 100% of all capital gains reported for federal income tax purposes by an individual, including gains from cryptocurrency, stocks, and real estate, may be subtracted when calculating Missouri adjusted gross income, based on the Missouri Department of Revenue official news release.
- The Missouri Department of Revenue Director confirmed the department was already preparing for adjustments required by HB 594 and related new laws affecting taxpayers, based on the Missouri Department of Revenue official news release citing Director of Revenue Trish Vincent.
- The HB 594 capital gains exemption applies to both short-term and long-term capital gains, but does not currently extend to C-corporations; corporations may deduct 100% of capital gains only in the tax year following the year in which the top individual income tax rate falls to 4.5% or lower, based on the Missouri Department of Revenue official news release.
- The fiscal note for Missouri HB 594 estimated revenue reductions to the state of over $185 million in fiscal year 2026 and over $261 million by fiscal year 2031, based on RSM US analysis of the HB 594 fiscal note.
Washington State Capital Gains Tax: Collections and Rate Data
- Washington State capital gains excise tax collections totaled $840.3 million in the first year of collection (tax year 2022), fell to $416.6 million in tax year 2023, and recovered to $560.6 million in tax year 2024 initial collections as of June 2, 2025, based on the Washington State Department of Revenue news releases.
- Tax year 2024 Washington capital gains excise tax collections exceeded $560.6 million as of June 2025, up from $416.6 million in tax year 2023, a 34% year-over-year increase, based on the Washington State Department of Revenue news release published June 5, 2025.
- Tax year 2023 Washington capital gains excise tax final collections totaled $416.6 million after refunds, based on the Washington State Department of Revenue news release published February 10, 2025 covering tax year 2023 final collections.
- For tax year 2024, the Washington capital gains excise tax applied after a standard deduction of $270,000, and for tax year 2025 the standard deduction is $278,000, based on the Washington State Department of Revenue capital gains tax page.
- Starting with tax year 2025, Washington capital gains in excess of $1 million will be taxed at 9.9% under SB 5813 signed May 20, 2025, while gains under $1 million continue to be taxed at 7%, based on the Washington State Department of Revenue news release published June 5, 2025.
- The Washington Department of Revenue has confirmed that cryptocurrency held for more than one year and sold by a Washington domiciliary is subject to Washington’s capital gains excise tax, as cryptocurrency is considered intangible property for purposes of the capital gains tax, based on the Washington State Department of Revenue FAQ on capital gains tax.
- Revenue from Washington’s capital gains excise tax funds education, with up to $524 million (adjusted for inflation) earmarked for the Education Legacy Trust Account and any remainder deposited into the Common School Construction Account, based on the Washington State Department of Revenue capital gains tax page.
California Crypto Tax Rate Statistics
- California taxes all capital gains from cryptocurrency as ordinary income at progressive rates from 1% to 12.3%, with an additional 1% Mental Health Services Tax for incomes over $1 million bringing the effective top rate to 13.3%, with no separate capital gains rate applicable to any holding period, based on the California Franchise Tax Board official tax treatment of capital gains.
- California’s top marginal income tax rate of 13.3% is the highest state income tax rate in the United States, applying to single filers with taxable income exceeding approximately $1 million after deductions, based on the California Franchise Tax Board tax bracket schedule for 2025.
- The California Franchise Tax Board treats cryptocurrency as property for state tax purposes, conforming generally to federal treatment under IRS Notice 2014-21, and requires all crypto gains and income to be reported on California Form 540, based on California Franchise Tax Board official guidance.
- California’s Digital Financial Assets Law (DFAL), which took effect in July 2025, established a comprehensive regulatory framework for cryptocurrency businesses operating in California, based on official California legislative records.
New York Crypto Tax Rate Statistics
- New York State applies ordinary income tax rates from 4% to 10.9% to all capital gains from cryptocurrency with no distinction between short-term and long-term holdings, based on the New York State Department of Taxation and Finance treatment of capital gains as ordinary income.
- New York City residents pay an additional city income tax of 3.078% to 3.876% on income including crypto gains, with the highest rate applying to taxable income over $500,000, based on the New York State Department of Taxation and Finance 2024 estimated income tax guidance as cited in available tax guidance for New York City rates.
- New York’s BitLicense, introduced by the New York State Department of Financial Services in July 2014 and administered by the NYDFS, requires any business conducting virtual currency business activity in New York or with New York residents to obtain a Virtual Currency License, establishing one of the strictest state crypto regulatory regimes in the United States, based on the BitLicense framework under 23 NYCRR Part 200.
Colorado Cryptocurrency Tax Payment Program Statistics
- The Colorado Department of Revenue began accepting cryptocurrency as payment for all state taxes on September 1, 2022, becoming the first state to do so, with payments processed through the PayPal Cryptocurrencies Hub, which converts digital assets to US dollars before remitting to the state, based on the official Colorado Department of Revenue cryptocurrency tax page.
- Colorado received 78 total cryptocurrency tax payments from September 2022 through December 2024, consisting of 8 payments in 2022, 22 in 2023, and 48 in 2024, for a cumulative total of $57,211, representing approximately 0.0005% of Colorado’s $11 billion in individual income tax collected in fiscal year 2022-23, based on official Colorado Department of Revenue data cited by Colorado Newsline published April 15, 2025.
- Colorado’s standard state income tax rate for tax year 2025 is a flat 4.40%, applicable to all income including cryptocurrency gains and staking income, with a temporary reduction to 4.25% for tax year 2024 triggered by excess state revenue under the Taxpayer’s Bill of Rights (TABOR), based on official Colorado Department of Revenue income tax guidance.
Wyoming Digital Asset Legislative Framework
- Wyoming exempted virtual currency from property taxation under Wyoming Senate File 111, which amended the Wyoming Taxation and Revenue Act to define virtual currency as a digital representation of value not recognized as legal tender and explicitly exempt it from state property tax, based on Wyoming Statutes.
- Wyoming enacted the Wyoming Decentralized Unincorporated Nonprofit Association (DUNA) Act, signed by Governor Mark Gordon on March 7, 2024, and effective July 1, 2024, giving decentralized autonomous organizations legal standing to contract with third parties, open bank accounts, appear in court, and pay taxes, based on the DUNA Act legislative text.
- Wyoming issued the Frontier (FRNT) stablecoin on August 29, 2025, becoming the first US state to issue its own stablecoin, following the signing of the federal GENIUS Act on July 18, 2025, based on official Wyoming state communications.
Puerto Rico Act 60 Investor Program: Rates and Structure
- Puerto Rico’s Act 60 (the Puerto Rico Incentives Code of 2019) provides qualifying bona fide residents with a 0% Puerto Rico income tax exemption on all post-relocation capital gains from cryptocurrency and other capital assets, as well as 100% exemption on dividends and interest, for decrees obtained through December 31, 2026, based on the official InvestPR Act 60 tax benefits summary.
- Act 60 Chapter 3 (formerly Act 20) provides export service businesses operating in Puerto Rico with a flat 4% corporate income tax rate, compared to the 21% federal corporate tax rate on the mainland, based on the official InvestPR tax benefits summary.
- Under Puerto Rico Act 38-2026 signed in March 2026, the Act 60 Resident Individual Investor program is extended through 2055, but new applicants who file on or after January 1, 2027 will be subject to a 4% preferential rate on post-relocation capital gains, dividends, and interest, rather than the 0% rate available to those who obtain their decree by December 31, 2026, based on the Procopio law firm summary of Act 38-2026.
- The Act 60 0% capital gains exemption applies only to capital gains accrued after establishing Puerto Rico bona fide residency; gains on assets acquired before moving to Puerto Rico remain subject to US federal tax treatment, based on the official InvestPR Act 60 tax benefits summary and IRS residency sourcing rules under IRC Section 937.
- Qualifying for Act 60 as a Resident Individual Investor requires physical presence in Puerto Rico for at least 183 days per year, purchase of real property in Puerto Rico as a primary residence within 2 years of obtaining the decree, and not having been a Puerto Rico resident for the 10 years preceding Act 60’s effective date, based on official InvestPR residency qualification requirements.
Key State Capital Gains Deductions and Preferential Rates
- Montana taxes long-term capital gains at a lower rate of either 3% or 4.1% depending on total income, representing a preferential rate compared to ordinary income tax treatment, based on the Montana Department of Revenue tax rate guidance.
- New Mexico allows a 40% deduction of net capital gains from state taxable income, reducing the effective state tax rate on capital gains from cryptocurrency, based on the New Mexico Taxation and Revenue Department capital gains guidance.
- North Dakota allows a 40% deduction on long-term capital gains from state taxable income, based on the North Dakota Office of State Tax Commissioner capital gains guidance.
- South Carolina allows a 44% deduction on long-term capital gains from state taxable income, based on the South Carolina Department of Revenue capital gains guidance.
- Wisconsin allows a 30% deduction on long-term capital gains from state taxable income, based on the Wisconsin Department of Revenue capital gains guidance.
- Vermont allows a $5,000 deduction on capital gains from state taxable income, based on the Vermont Department of Taxes capital gains guidance.
- Maryland imposes an additional 2% surtax on capital gains for taxpayers earning more than $350,000, adding to the state’s regular income tax rates on crypto gains for high-income earners, based on the Maryland Comptroller of Maryland capital gains surtax provisions.
References
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