This is not tax advice
We are an information site, not a tax adviser, and this page cannot account for your circumstances. Figures are indexed and change annually. Confirm current thresholds with the IRS, HMRC or the ATO, and take professional advice on anything substantial.
The US position
The American treatment surprises people because it is more generous than expected in one direction and less in another.
Giving crypto is generally not a taxable disposal for the giver. You do not realise a gain by handing an asset to somebody else as a gift. This is quite different from selling it, and it is the key structural fact.
The annual gift tax exclusion for 2026 is $19,000 per recipient. Give up to that much to any one person in the year and nothing needs reporting and nothing is used up. The limit is per recipient, so giving $19,000 each to four different people is $76,000 of gifting with no return required.
Married couples can shelter up to $38,000 per recipient where each spouse uses their own exclusion, or where valid gift-splitting rules apply.
Above the annual exclusion, you file Form 709. That does not mean paying tax. It means the excess counts against your lifetime federal estate and gift tax exclusion, which for 2026 stands at $15,000,000 per individual. Gift tax becomes payable only once that is exhausted, which for most people never happens.
Carryover basis — the part that matters most
This is the rule that catches people, and it is the single most important thing on this page for anyone receiving crypto as a gift.
The recipient’s cost basis is generally the same as the donor’s. Not the value on the day of the gift. The original purchase price, however long ago that was.
The consequence is straightforward and can be large. If you bought Bitcoin at $8,000 and gift it when it is worth $60,000, the recipient does not start from $60,000. They inherit your $8,000 basis, and when they sell, their taxable gain is measured from there. They have received the asset and the entire embedded gain along with it.
The loss rule works differently
If the market value at the time of the gift was lower than the donor’s basis, the recipient’s basis for calculating a loss is limited to that lower value.
This prevents transferring an unrealised loss to somebody else to use. It creates the odd situation where the same asset can have one basis for gains and another for losses.
Practically, this means the donor must tell the recipient what they paid and when. Without those two numbers the recipient cannot compute what they owe when they sell, and reconstructing them years later from exchange records that may no longer exist is genuinely difficult.
When Form 709 applies
Form 709 is the United States Gift (and Generation-Skipping Transfer) Tax Return. You file it when a gift to any single recipient exceeds the annual exclusion in a calendar year.
Filing it is administrative rather than punitive. It records the gift, applies the excess against your lifetime exclusion, and creates a paper trail. Form 709 for gifts made during 2026 is generally due 15 April 2027, aligning with the individual return deadline.
Two practical notes. First, valuation matters: a crypto gift is valued at fair market value on the date of the gift, and with a volatile asset that means recording the date and a defensible price source rather than reconstructing it later. Second, the annual exclusion is per calendar year, so timing a large gift across a year boundary can keep both halves within it.
The UK is different in an important way
Anyone applying American intuition to British rules will get this wrong, and the error is expensive.
In the UK, gifting a cryptoasset to anyone other than a spouse or civil partner is generally treated as a disposal for capital gains tax purposes at market value. The giver may have a taxable gain even though they received nothing and no money moved.
That is close to the opposite of the US position. In America the giver typically has no event; in Britain the act of giving is itself the event. Transfers between spouses and civil partners are generally on a no-gain-no-loss basis, which is the main exception.
HMRC publishes detailed cryptoasset guidance covering disposals, pooling and allowable costs, and it is worth reading directly rather than through secondary sources, because the treatment of pooled holdings is specific and not intuitive.
Australia and the CGT discount
Australia sits closer to the UK than to the US. Disposing of a crypto asset by giving it away is generally a CGT event for the giver, assessed at market value at the time of the disposal.
The feature that generates most searches is the 50% CGT discount, available to individuals on assets held for more than twelve months. It is frequently confused with a promotional offer because of how it is described online; it is neither a promotion nor specific to crypto. It is a general capital gains provision that applies to qualifying assets.
Record-keeping expectations in Australia are demanding. The ATO expects dates, values in Australian dollars, the purpose of the transaction and counterparty details where relevant, and expects them kept for years. Our Australia page covers the wider regulatory picture including AUSTRAC registration.
What to record, at the moment of the gift
Whatever jurisdiction you are in, the same four items answer nearly every question that arises later. Write them down when you make the gift, not when somebody asks.
- Date of the gift — determines valuation and which tax year it falls in.
- Amount and asset — precisely, including which network if relevant.
- Market value on that date — with a note of the price source used.
- The donor’s original cost and acquisition date: the carryover basis the recipient will need.
Four lines in a note, kept with the gift. It costs two minutes and it is the difference between a straightforward calculation and an unanswerable one.
The pattern we see go wrong
Somebody receives crypto as a gift, holds it for three years, sells it, and then discovers they need the donor’s purchase price from an exchange account that was closed in the interim. The donor no longer has the records. The exchange no longer exists.
There is no clean way out of that, and it is entirely preventable by a note written at the time. Of everything on this page, that is the part we would actually act on.