What Happens to Your Cryptocurrency Tax at Death Account When You Die
Quick Facts
Step-up
Yes — crypto qualifies
Timing
24/7 trading matters
Complexity
High for DeFi/NFTs
Step-by-Step Guide
Crypto gets the step-up in basis
The IRS treats cryptocurrency as property. Inherited crypto receives a step-up in basis to its fair market value at the date of death, eliminating all prior capital gains.
Time of death matters — 24/7 trading
Unlike stocks, crypto trades 24/7 with no closing price. Document prices at the exact time of death if possible. Use CoinGecko or CoinMarketCap historical data to establish FMV.
Screenshot and document every coin
Take screenshots of each wallet and exchange account balance. Document the price of each token separately — Bitcoin, Ethereum, and alt-coins all need individual valuations.
Estimated time: Do today
DeFi and NFT valuation is complex
Liquidity pool positions, staked tokens, NFTs, and DeFi protocol positions require specialized valuation. NFT floor prices may not reflect actual value. Document everything you can find.
Hire a crypto CPA for holdings over $50k
Crypto tax reporting is complex and errors are expensive. For holdings over $50,000, hire a CPA who specializes in cryptocurrency. They can help with proper step-up documentation and Form 8949 reporting.
Document Now Checklist
- Screenshot all exchange account balances immediately
- Record prices of each token at or near time of death
- List all wallets (hot and cold) with addresses
- Document any DeFi positions, staked tokens, or NFTs
- Save CoinGecko/CoinMarketCap historical price data for the date of death
Last verified: June 2026. Platform policies may change. Verify current procedures directly with Cryptocurrency Tax at Death. This guide is for informational purposes only and does not constitute legal advice.
Related Guides
Final Income Tax Return (Form 1040)
The final income tax return covers January 1 through the date of death. It must be filed by April 15 of the year after death. Late filing triggers penalties and interest.
Estate Income Tax (Form 1041)
Form 1041 is required if the estate generates more than $600 in gross income during any tax year while it remains open. Income includes interest, dividends, rent, and capital gains earned by estate assets after the date of death.
Estate Tax Return (Form 706)
Even if the estate is below the federal threshold, you may still need to file Form 706 to elect portability — which transfers the unused exemption to the surviving spouse. This election is critical and must be made on a timely filed Form 706.
Protect your Cryptocurrency Tax at Death account — and all your others
Document your digital life in a zero-knowledge encrypted vault. 1,800+ platform guides. Dead Man's Switch. Everything your family needs.
Start your free trial →