NFT Taxes 101 (2025): Mints, Royalties & Gas Deductions

NFTs aren’t a tax-free zone. This guide explains how US taxes apply to mints, flips, royalties, and gas fees, and how “collectible” treatment can change your capital-gains rate. We also cover simple record-keeping so your 8949 isn’t a mess.

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What is taxed with NFTs

Buying an NFT with crypto: You dispose of the crypto → taxable gain/loss on that crypto.
Selling an NFT: Capital gain/loss vs your basis in the NFT.
Royalties to creators: Generally ordinary income at receipt.

Are NFTs “collectibles” for tax?

The IRS signaled that certain NFTs may be treated as collectibles depending on a look-through to the underlying asset/use (e.g., art). See Notice 2023-27. Collectible long-term gains can be taxed up to 28% instead of the usual 0/15/20% brackets. Keep documentation of what you bought and why it should/shouldn’t be collectible.

Mints, gas, and basis

Mint cost basis: Cost of the NFT (if any) + gas fees paid in the transaction.
Free mints: Basis is the gas you spent to mint.
Airdropped NFTs: Basis generally equals income recognized at receipt (if any) + gas to claim.

Track tx hashes and USD values at the time of mint. For general guidance on capital assets, see Topic 409 – Capital Gains.

Sales, swaps, and royalties

Sale for crypto: Proceeds in USD at sale time minus basis = capital gain/loss.
Swap NFT ↔ NFT or for tokens: Typically a taxable disposition; record both sides at FMV.
Creator royalties: Ordinary income when received; basis for those coins equals the income recognized.

Can I deduct gas fees?

Yes, but context matters. Gas attached to acquiring or disposing of an NFT is generally capitalized into basis or reduces proceeds. Creator/business gas may be deductible as an expense. Keep itemized records and consult a tax pro for your facts. See IRS small business resources: SB/SE.

How to report on 8949/Schedule D

Aggregate all NFT mints, buys, and sales with dates, USD values, and gas.
Output Form 8949 lines for each disposal; summarize totals on Schedule D.
If claiming collectible treatment, document why under Notice 2023-27’s look-through concept.

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Creator taxes (income & expenses)

Primary sales and ongoing royalties are typically ordinary income at receipt (in USD FMV).
Reasonable business expenses (platform fees, contract deploy gas, marketing) may be deductible.
Keep separate wallets for business vs personal if possible.