Crypto Tax Analysis and Savings Report for 2025
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### **Executive Summary**
Based on your input, this report outlines your estimated crypto tax liability and suggests strategies to minimize taxes while maximizing after-tax profits. Using tax-saving measures, deductions, and investment planning, the goal is to significantly reduce your tax liability.
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### **Step 1: Tax Liability Calculation**
#### **Inputs from User**:
1. **Short-Term Capital Gain (STCG):** $361,863
2. **Long-Term Capital Gain (LTCG):** $371,303
3. **Annual Income (Ordinary Income):** $648,206
4. **Location:** Kansas
5. **Filing Status:** Single
#### **Step 1A: Federal Tax Rates for 2025 (Single)**
- **STCG and Income Tax:** Taxed at Federal Income Tax rates since they are treated as ordinary income.
- **Federal Brackets for 2025:**
- 37% for income over $626,350
- 35% for income between $250,525 - $626,350
- 32% for income between $197,300 - $250,525
- **LTCG Tax Rates:** Long-term capital gains are taxed based on income level:
- 15% for income levels between $48,475 - $518,900
- **20% for income above $518,901**
#### **Step 1B: Federal Tax Calculation**
1. **Ordinary Income + STCG = $648,206 + $361,863 = $1,010,069**
- **At the 37% bracket**:
Taxable income above $626,350 = $1,010,069 - $626,350 = $383,719
Tax = $383,719 × 37% = **$141,776**
- Remaining taxable income below $626,350 (€197,300 to €626,350 range applies):
Tax = ($626,350 - $250,525) × 35% = **$131,548.75**
Tax Total (STCG + Income):