What are the tax benefits of donating cryptocurrency to charity in 2025?

Donating appreciated cryptocurrency to a qualified 501(c)(3) charity can be one of the most tax-efficient giving strategies available, potentially saving you more than donating cash.

How it works: If you donate crypto that you have held for more than one year and it has appreciated in value, you can deduct the full fair market value as a charitable contribution on Schedule A, and you avoid paying capital gains tax on the appreciation. This is the same rule that applies to donating appreciated stock.

Example: You bought 1 Bitcoin for $10,000, and it is now worth $60,000. If you sell and donate the cash, you pay capital gains tax on the $50,000 gain (up to $11,900 at 23.8%) and donate $60,000. If you donate the Bitcoin directly, you deduct $60,000 and pay $0 in capital gains tax. Your total tax benefit is significantly higher with the direct donation.

Requirements and limits:

• Must hold the crypto for more than one year (long-term). Short-term holdings are only deductible at cost basis, not fair market value.
• Deduction is limited to 30% of AGI for appreciated property donated to public charities. Excess carries forward 5 years.
• Donations over $5,000 in non-cash property generally require a qualified appraisal. The IRS has not fully clarified appraisal requirements for crypto, but using the fair market value from a major exchange at the time of donation is generally accepted.
• You need a written acknowledgment from the charity for donations of $250 or more.

How to donate: Several charities accept crypto directly (The Giving Block, Fidelity Charitable, Schwab Charitable). Donor-Advised Funds (DAFs) that accept crypto are particularly convenient, as you get the deduction immediately and can recommend grants to specific charities over time.

Report on Form 8283 (Noncash Charitable Contributions) for donations over $500.