Does this apply to DeFi swaps on Uniswap?

Yes — the IRS treats all crypto swaps as taxable disposals regardless of the platform used. Whether you swap on a DEX, CEX, or through a smart contract, the tax treatment is the same.

What if I swapped at a loss?

Capital losses can offset capital gains. Up to $3,000 of net losses can be deducted against ordinary income per year. Excess losses carry forward to future tax years.

Do I need to report every swap?

Yes — every swap is a taxable event and must be reported on Form 8949 and Schedule D, even if it results in a loss. There is no de minimis exception for crypto swaps.

Is wrapping ETH into WETH a taxable event?

The IRS has not issued guidance on token wrapping (e.g., ETH → WETH). Most tax professionals treat it as a taxable swap since WETH is a distinct ERC-20 token. Others argue it is a non-taxable conversion of the same underlying asset. Until the IRS provides clarity, the conservative approach is to treat it as a taxable disposal.