Crypto ICO Tax Treatment Guide for Initial Coin Offerings (2026)
Understand ICO participation tax treatment: token purchase, allocation, vesting, and reporting for initial coin offering participation.
Summary
ICO participation has specific tax treatment. This guide explains purchase basis, allocation income, vesting treatment, and reporting requirements.
Key Steps
- 1Track purchase basis: ICO purchase price becomes token cost basis.
- 2Report allocation income: free tokens received taxable at FMV.
- 3Document vesting tokens: vesting creates income at vesting date, not ICO.
- 4Track lockup period: tokens locked still taxable when received.
- 5Maintain ICO records: purchase confirmation, allocation schedule, vesting terms.