Can I sell crypto without California tax after moving to Nevada?

If you properly establish Nevada residency before selling, gains realized as a Nevada resident aren't taxable by California. California audits high-income departing residents—complete all residency steps and document day counts first.

Will a Nevada LLC help me avoid crypto taxes?

No. If you're a resident of another state, a Nevada LLC doesn't change your home state tax obligations. Nevada LLCs provide privacy and asset protection, not tax avoidance for out-of-state residents.

How do I establish Nevada residency for tax purposes?

Key steps: obtain Nevada driver's license within 30 days, register to vote, update vehicle registration, establish Nevada banking, update professional licenses, document your move, sever former state ties, and track day counts.

Nevada Crypto Tax Services

Q: Does Nevada tax cryptocurrency gains?

No, Nevada does not impose state income tax on cryptocurrency gains. State legislation from 2017 prohibits taxation of blockchain or smart contracts. Federal income tax still applies with rates up to 40.8% for short-term gains.

Introduction to Crypto Taxation

Nevada offers cryptocurrency investors a compelling advantage: no state income tax on crypto gains. This guide explains how Nevada's unique tax laws affect cryptocurrency investors and outlines federal compliance requirements that still apply. Whether you're a long-time Nevada resident, considering relocation from a high-tax state, or seeking to optimize your tax position, understanding your crypto tax obligations is essential.

The IRS treats digital assets as property, meaning most crypto transactions are subject to capital gains taxes at the federal level. This includes selling crypto for fiat currency, exchanging one digital asset for another, and using crypto to pay for goods and services. While Nevada imposes no state-level income tax, federal tax rules apply to all residents.

The Silver State Advantage: No Income Tax and Strong Privacy Protections

Nevada provides cryptocurrency investors a combination of no state income tax, strong privacy laws for corporate entities, and favorable asset protection statutes. State legislation from 2017 prohibits taxation of blockchain or smart contracts, reinforcing Nevada's crypto-friendly stance. These features have made Nevada popular for crypto investors and holding companies seeking confidentiality alongside tax efficiency.

At Monaco CPA, we provide remote crypto tax services to Nevada residents throughout the state. While Nevada's lack of state income tax eliminates state tax obligations, federal compliance remains essential—particularly with the 2025 regulatory changes including Form 1099-DA reporting and wallet-by-wallet cost basis tracking.

What Nevada Residents Still Owe

No state income tax doesn't mean no taxes. Nevada crypto investors are subject to federal income tax and must comply with IRS reporting requirements.

Federal Income Tax

Federal Compliance Requirements (2025)

Revenue Procedure 2024-28: Requires wallet-by-wallet cost basis tracking effective January 1, 2025. You must track the purchase price and sale price for each wallet separately rather than aggregating across all wallets.
Form 1099-DA: Custodial brokers began reporting gross proceeds for 2025 transactions. Cost basis reporting becomes mandatory for assets acquired after January 1, 2026. Learn more about Form 1099-DA.
DeFi Broker Rule Repealed: H.J.Res.25 was signed April 10, 2025, voiding DeFi broker regulations. DeFi platforms and non-custodial wallets are not required to issue Form 1099-DA.
Form 8949: Required for reporting all crypto sales and exchanges.
$3,000 Capital Loss Limit: Federal limit on deducting capital losses against ordinary income per year, with unlimited carryforward of unused losses.

Understanding Taxable Events

Recognizing which activities trigger tax obligations is essential for managing crypto taxes. Taxable events include:

Selling digital assets for cash
Trading one cryptocurrency for another
Using crypto to make purchases
Receiving crypto as payment for goods or services
Earning staking rewards, mining income, or interest from lending platforms

Each of these actions may result in capital gains or losses depending on the difference between the asset's cost basis and its fair market value at the time of the transaction. Assets held for more than one year qualify for long-term capital gains rates, which are typically lower than short-term rates.

Crypto Income and Taxation

Crypto income can arise from various activities, each with specific tax implications.

Types of Crypto Income

Trading digital currencies
Earning staking rewards (taxable as ordinary income at receipt per Rev. Rul. 2023-14)
Mining cryptocurrency
Receiving interest income from lending platforms
Participating in DeFi protocols

State Tax Law Differences

While Nevada imposes no state income tax on crypto holdings or other income, other states vary significantly:

California: 13.3% top rate with no long-term capital gains preference
New York: Up to 10.9% state rate, plus 3.876% NYC resident tax
Washington: No income tax but imposes a 7% capital gains tax on gains between $278,000 and $1 million, and 9.9% on gains exceeding $1 million (2025 thresholds)

Relocating to Nevada from High-Tax States

Nevada's tax advantages make it a popular destination for crypto investors leaving high-tax states like California, New York, and New Jersey. However, your former state may continue to claim taxing authority if you don't properly establish Nevada residency.

Residency Establishment Steps

Obtain Nevada Driver's License: Required within 30 days of establishing residency.
Register to Vote in Nevada: Demonstrates intent to make Nevada your permanent home.
Update Vehicle Registration: Register your vehicles in Nevada.
Establish Nevada Banking: Open accounts at Nevada banks or credit unions.
Update Professional Licenses: Transfer or obtain new licenses in Nevada.
Document Your Move: Keep records of lease/purchase agreements, utility connections, and moving expenses.
Sever Former State Ties: Cancel gym memberships, club memberships, and subscriptions in your former state.
Track Day Counts: Maintain a calendar documenting your physical presence in each state.

California Departure Audits

California's Franchise Tax Board aggressively audits high-income departing residents. If you move from California and have significant income, expect scrutiny of your day counts, family location, and ties to both states. A statutory resident is someone who spends more than 183 days in the state while maintaining a permanent place of abode. We help clients document their departure properly.

Tax Planning Strategies for Crypto Investors

Smart tax planning can significantly reduce your overall tax burden.

Long-Term Holding

Hold crypto assets for more than a year to qualify for long-term capital gains tax rates (0%, 15%, or 20% vs. up to 37% for short-term gains).

Tax-Loss Harvesting

Sell digital assets that have declined in value to offset gains from other investments. The wash sale rule does not currently apply to cryptocurrency, allowing immediate repurchase after selling at a loss.

Charitable Donations

Donating appreciated crypto assets to qualified charities provides a tax deduction while avoiding capital gains tax on the appreciation.

Recordkeeping

Maintain detailed records of all crypto transactions including purchases, sales, exchanges, and wallet transfers. This is especially critical under Rev. Proc. 2024-28's wallet-by-wallet tracking requirements.

Tax-Deferred Accounts

Consider self-directed IRAs to hold crypto and defer taxes on gains until withdrawal.

Services for Nevada Crypto Investors

Federal Tax Return Preparation: Complete Form 1040 with Form 8949 and Schedule D for all crypto activity, including reporting all types of crypto income.
Transaction Reconciliation: Rev. Proc. 2024-28 compliant wallet-by-wallet tracking.
Form 1099-DA Matching: Reconciling exchange-reported data to prevent IRS CP2000 notices.
Tax-Loss Harvesting: Strategic loss realization (wash sale rules do not apply to crypto).
Residency Establishment Documentation: Building the paper trail that proves your Nevada domicile.
Former State Audit Defense: Representation if California or another state challenges your departure.
Part-Year Return Preparation: For the year of your move, handling returns for both states.
Entity Structure Review: Analysis of Nevada LLC/trust structures for asset protection.
IRS Audit Defense: Representation before the IRS if needed.
Estimated Tax Planning: Quarterly federal projections to avoid underpayment penalties.

Areas We Serve in Nevada

We serve Nevada crypto investors statewide through our remote service model:

Las Vegas Area: Las Vegas, Henderson, North Las Vegas, Summerlin
Reno-Tahoe: Reno, Sparks, Carson City, Lake Tahoe communities
Other Areas: All Nevada communities via secure portal and video consultation

Frequently Asked Questions

I moved from California to Nevada. Can I sell my crypto now without California tax?

If you've properly established Nevada residency before selling, gains realized as a Nevada resident aren't taxable by California. However, California will scrutinize your departure. Make sure you've completed all residency establishment steps, can document your day counts, and have severed significant California ties before executing major sales.

Will forming a Nevada LLC help me avoid crypto taxes?

No. If you're a resident of another state, forming a Nevada LLC to hold crypto doesn't change your home state tax obligations. You'll still owe tax where you live. Nevada LLCs are valuable for privacy and asset protection, not tax avoidance for out-of-state residents.

Is Nevada's no-income-tax status secure?

Nevada's constitution prohibits a state income tax without voter approval. Given Nevada's economic reliance on attracting residents from high-tax states, implementing an income tax would be politically difficult and economically counterproductive.

I split time between California and Nevada. Where do I pay tax on crypto gains?

This depends on which state considers you a resident. If you spend more than 183 days in California while maintaining a "permanent place of abode" there, California will consider you a statutory resident regardless of your Nevada ties. Proper planning around day counts and domicile factors is essential for dual-state situations.

Does Nevada charge sales tax on cryptocurrency transactions?

Nevada does not currently impose sales tax on cryptocurrency transactions. State legislation from 2017 specifically prohibits taxation of blockchain or smart contracts.

Are there new IRS reporting requirements for 2025?

Yes. Form 1099-DA reporting began January 1, 2025 for gross proceeds. Rev. Proc. 2024-28 requires wallet-by-wallet cost basis tracking. Cost basis reporting on 1099-DA becomes mandatory for assets acquired after January 1, 2026. The DeFi broker rule was repealed in April 2025, so DeFi platforms are not required to issue 1099-DAs.

Get Expert Help with Nevada Crypto Taxes

Nevada's no-income-tax status is a significant advantage, but federal compliance still matters. Whether you're a long-time Nevada resident or recently relocated from a high-tax state, let's discuss your situation and ensure proper compliance.

Schedule a Consultation

Phone: (862) 320-9554
Email: Greg@MonacoCPA.CPA