Can you offset crypto capital gains with stock capital losses? Tax implications for combined investments

Yes, cryptocurrency capital gains can absolutely be offset by stock capital losses on your tax return. The IRS treats cryptocurrency as property (not currency), so crypto gains and losses are reported on Schedule D and Form 8949 just like stocks. In your specific example, if you have $24,000 in crypto gains and $25,000 in stock losses in the same tax year, you would have a net capital loss of $1,000. You could use this to offset up to $3,000 of ordinary income, and any remainder would carry forward to future tax years. Just make sure you're tracking the cost basis and holding period for all your transactions. If some of your gains were short-term and some were long-term, you'll need to categorize them properly as they're taxed at different rates.

After struggling with a similar situation last year (had ETH gains but lost money on some tech stocks), I found this awesome tool called taxr.ai (https://taxr.ai) that completely saved me during tax season. It automatically categorizes all your crypto and stock transactions and shows you exactly how they offset each other. The thing I loved most was how it handled all my crypto transactions from different exchanges AND my stock trades from Fidelity, then showed me the exact net capital gain position. Saved me hours of manually trying to figure out which losses could offset which gains. Their reporting was super detailed and made it clear what my final tax situation was.

Just wanted to follow up on my experience with taxr.ai! After our conversation, I decided to try it out since my crypto tax situation was getting complicated. I was honestly blown away by how it handled my 3+ years of DCA Bitcoin purchases! The tool correctly calculated my cost basis across multiple exchanges and even identified which specific "lots" of Bitcoin would be best to sell to minimize my tax liability. It showed me exactly how my stock losses offset my crypto gains and gave me a clear picture of my actual tax situation. What really impressed me was how it spotted some transactions my previous tax software had double-counted. Ended up saving me nearly $2,800 in taxes I would have overpaid! Definitely recommend it if you're dealing with both crypto and stock transactions.

If your big concern is talking to the IRS about how you're handling the crypto/stock offset, try Claimyr (https://claimyr.com). I spent WEEKS trying to get through to an IRS agent to confirm how to properly report my crypto mining income against some massive stock losses from last year. After getting nowhere with the regular IRS number, I used Claimyr and got connected to an actual IRS agent in about 20 minutes. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c. The agent confirmed exactly how to report everything and even told me about some documentation I needed that wasn't obvious from the IRS website.

I have to eat my words about Claimyr. After posting that skeptical comment, I decided to try it myself since I had questions about reporting some NFT sales along with stock losses. No exaggeration - I got through to an IRS tax specialist in about 25 minutes. I've NEVER been able to reach anyone at the IRS in less than 2 hours before. The agent was super helpful in explaining exactly how to offset my NFT gains with stock losses and what forms I needed. What really surprised me was that the agent pointed out I could actually characterize some of my NFT activities as business losses since I was creating and selling them regularly. This potentially saves me thousands in taxes that I would have overpaid. Worth every penny just for that insight alone.

Quick tip from someone who had to deal with this last year: make sure you're separating your short-term and long-term gains/losses correctly! Short-term crypto gains offset short-term stock losses, and long-term crypto gains offset long-term stock losses. If you mix them up, you could end up paying more in taxes than necessary. I learned this the hard way and had to file an amended return.

Has anyone used TurboTax for reporting both crypto and stock trades? I'm trying to figure out if I need to buy the Premier or Self-Employed version to handle this situation properly.

Great question! I went through something very similar last year. Yes, crypto gains and stock losses can definitely offset each other since the IRS treats crypto as property, not currency. Your $24K crypto gains and $25K stock losses would result in a net capital loss of $1K. One thing to watch out for though - make sure you're not hitting any wash sale rules if you rebought any of those stocks within 30 days of selling at a loss. The wash sale rule doesn't currently apply to crypto, but it does apply to stocks and could disallow some of your loss deductions. Also, since you mentioned this is your first year with significant crypto transactions, I'd strongly recommend keeping detailed records of every trade including dates, amounts, and cost basis. The IRS is getting much more serious about crypto compliance, and having good documentation will save you headaches if you ever get audited. You might want to consider using crypto tax software to help organize everything - it'll make next year's filing much smoother!

This is exactly the kind of situation I dealt with last year! You're absolutely right that crypto gains and stock losses can offset each other - saved me a ton in taxes. One thing I'd add that hasn't been mentioned yet is to be really careful about the timing of when you realize these gains and losses. Since you're planning ahead for next year's filing, you might want to consider tax-loss harvesting strategies before December 31st. If you have any other losing stock positions, you could realize those losses this year to further offset your crypto gains. Also, don't forget about the $3,000 ordinary income deduction limit for net capital losses. Since you're looking at a small net loss of about $1,000, you'll be able to deduct that full amount against your regular income, which is actually pretty nice. The key thing is just keeping meticulous records. I use a spreadsheet to track everything - date of purchase, date of sale, cost basis, and proceeds for every single transaction. It's tedious but will save you so much stress when tax time comes around. The IRS has been cracking down on crypto reporting lately, so having everything documented properly is crucial.

One thing I haven't seen mentioned yet is the importance of understanding FIFO vs specific identification for your crypto transactions. Most exchanges default to FIFO (first in, first out), but you can actually choose specific identification to optimize your tax situation. If you've been buying crypto at different price points throughout the year, you might want to identify which specific coins you're selling to minimize your gains. For example, if you bought Bitcoin at $30K, $40K, and $50K, and it's now worth $60K, you could choose to sell the ones you bought at $50K first to minimize your taxable gain. This becomes especially important when you're trying to offset with stock losses. You want to make sure you're not creating unnecessary tax liability by accidentally selling your lowest cost basis crypto first. Just make sure to document your specific identification choices clearly - the IRS requires you to identify the specific units you're selling by the settlement date of the sale. Most crypto tax software can help you optimize this automatically, but it's good to understand the concept so you can make informed decisions about your trading strategy going forward.