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Worthless-token loss calculator

Here is how the math works when a dead bag gets sold, or gets claimed as worthless. General mechanics only: what the loss is, what it can offset this year, and what waits for later years.

What the lots cost, in total, in this wallet.
What the dust sale returned, or what the bag is worth today. Zero if nothing.
Gains from everything else sold this year, net. Zero if none.
The rate the last dollar of income is taxed at. Leave blank to skip the estimate.

Results appear here once cost basis is filled in. The arithmetic runs in the browser and stores nothing.

Worthless deduction. A worthlessness position needs the token to be worthless and abandoned, not just down. The IRS memo reads a token that still trades somewhere as not worthless, and for an individual it reads the deduction as a miscellaneous itemized deduction, suspended through 2025 when the memo was written. The statute has since dropped the end date: no such deduction is allowed for any tax year after 2017. The arithmetic above assumes the loss is a capital loss.[4][6]

Sale for zero. A sale needs a closed transaction: the token left the wallet for real currency, another token, or nothing, on a date with a receipt behind it. The loss is the difference between what it cost and what it fetched.

Migration carryover is not modelled here: swapping into a successor token moves the basis question to the new token, and that is its own arithmetic.

How the math works

The loss is cost basis minus current value. If the value is not below the basis, there is no loss and the panel says so.

The character is short-term when the token was held 1 year or less and long-term when it was held more than 1 year, counted from the day after it was acquired through the day it was disposed of.[2]

The loss offsets other net capital gains first, dollar for dollar. What is usable against gains is the smaller of the loss and those gains.

What is left offsets ordinary income up to $3,000.00 a year, or $1,500.00 for a married taxpayer filing separately. The rest carries forward.[1]

That cap is section 1211(b) of the Internal Revenue Code, which states the same $3,000.00 and $1,500.00 figures.[5]

Years to absorb is the carryforward divided by the cap, rounded up, with no future gains assumed. A future gain absorbs it faster.

The estimated tax value, when a rate is given, is everything the loss offsets this year multiplied by that one rate. It is an estimate of this year only.

A sale of virtual currency for real currency is a capital gain or loss, reported on Form 8949 and summarized on Schedule D.[3]

Sources
  1. [[1]] IRS Topic no. 409, Capital gains and losseshttps://www.irs.gov/taxtopics/tc409accessed 2026-09-01
  2. [[2]] IRS Instructions for Schedule D (Form 1040), Capital Gains and Losseshttps://www.irs.gov/instructions/i1040sdaccessed 2026-09-01
  3. [[3]] IRS Frequently Asked Questions on Virtual Currency Transactionshttps://www.irs.gov/individuals/international-taxpayers/frequently-asked-questions-on-virtual-currency-transactionsaccessed 2026-09-01
  4. [[4]] IRS Office of Chief Counsel Memorandum 202302011, applicability of section 165 to cryptocurrency that has declined in valuehttps://www.irs.gov/pub/irs-wd/202302011.pdfaccessed 2026-09-01
  5. [[5]] 26 U.S.C. 1211, Limitation on capital losses (Office of the Law Revision Counsel, current through August 31, 2026)https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section1211&num=0&edition=prelimaccessed 2026-09-01
  6. [[6]] 26 U.S.C. 67, 2-percent floor on miscellaneous itemized deductions (Office of the Law Revision Counsel, current through August 31, 2026)https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title26-section67&num=0&edition=prelimaccessed 2026-09-01

Not financial or tax advice. I am not a CPA or adviser.