diff --git a/task.py b/task.py
index 53cc8ed..40221a7 100644
--- a/task.py
+++ b/task.py
@@ -10,15 +10,63 @@
 from commands.done import mark_done
 
 
+DEFAULT_CONFIG_TEXT = """\
+# Task CLI configuration
+storage_dir: ~/.local/share/task-cli
+default_format: text
+"""
+
+DEFAULT_CONFIG = {
+    "storage_dir": "~/.local/share/task-cli",
+    "default_format": "text",
+}
+
+
+def get_config_path():
+    """Get path to config file."""
+    return Path.home() / ".config" / "task-cli" / "config.yaml"
+
+
+def _parse_config(text):
+    """Parse simple YAML key-value config into a dict."""
+    config = {}
+    for line in text.splitlines():
+        line = line.strip()
+        if not line or line.startswith("#"):
+            continue
+        if ":" in line:
+            key, _, value = line.partition(":")
+            config[key.strip()] = value.strip()
+    return config
+
+
 def load_config():
-    """Load configuration from file."""
-    config_path = Path.home() / ".config" / "task-cli" / "config.yaml"
-    # NOTE: This will crash if config doesn't exist - known bug for bounty testing
-    with open(config_path) as f:
-        return f.read()
+    """Load configuration from file.
+
+    If the config file does not exist, creates one with sensible defaults.
+    Returns a parsed config dict.
+    """
+    config_path = get_config_path()
+
+    if not config_path.exists():
+        try:
+            config_path.parent.mkdir(parents=True, exist_ok=True)
+            config_path.write_text(DEFAULT_CONFIG_TEXT)
+        except OSError as e:
+            print(f"Warning: Could not write default config: {e}", file=sys.stderr)
+        return dict(DEFAULT_CONFIG)
+
+    try:
+        with open(config_path) as f:
+            return _parse_config(f.read())
+    except OSError as e:
+        print(f"Warning: Could not read config file: {e}", file=sys.stderr)
+        return dict(DEFAULT_CONFIG)
 
 
 def main():
+    config = load_config()
+
     parser = argparse.ArgumentParser(description="Simple task manager")
     subparsers = parser.add_subparsers(dest="command", help="Command to run")
 
diff --git a/test_task.py b/test_task.py
index ba98e43..f78304f 100644
--- a/test_task.py
+++ b/test_task.py
@@ -1,10 +1,11 @@
 """Basic tests for task CLI."""
 
-import json
 import pytest
 from pathlib import Path
+from unittest.mock import patch
 from commands.add import add_task, validate_description
 from commands.done import validate_task_id
+from task import load_config, get_config_path, DEFAULT_CONFIG, DEFAULT_CONFIG_TEXT, _parse_config
 
 
 def test_validate_description():
@@ -28,3 +29,151 @@ def test_validate_task_id():
 
     with pytest.raises(ValueError):
         validate_task_id(tasks, 99)
+
+
+def test_load_config_missing_creates_default(tmp_path, monkeypatch):
+    """Test that missing config file is created with defaults."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    config = load_config()
+
+    assert config == DEFAULT_CONFIG
+    config_path = tmp_path / ".config" / "task-cli" / "config.yaml"
+    assert config_path.exists()
+    assert config_path.read_text() == DEFAULT_CONFIG_TEXT
+
+
+def test_load_config_existing_file(tmp_path, monkeypatch):
+    """Test that existing config file is read correctly."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    config_path = tmp_path / ".config" / "task-cli" / "config.yaml"
+    config_path.parent.mkdir(parents=True)
+    custom_config = "storage_dir: /custom/path\n"
+    config_path.write_text(custom_config)
+
+    config = load_config()
+
+    assert config == {"storage_dir": "/custom/path"}
+
+
+def test_load_config_returns_dict_copy(tmp_path, monkeypatch):
+    """Test that load_config returns a copy, not the global DEFAULT_CONFIG."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    config = load_config()
+    config["new_key"] = "new_value"
+
+    assert "new_key" not in DEFAULT_CONFIG
+
+
+def test_load_config_unwritable_parent(tmp_path, monkeypatch, capsys):
+    """Test graceful fallback when config directory cannot be created."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    with patch.object(Path, "exists", return_value=False):
+        with patch.object(Path, "mkdir", side_effect=OSError("Permission denied")):
+            config = load_config()
+
+    assert config == DEFAULT_CONFIG
+    captured = capsys.readouterr()
+    assert "Warning" in captured.err
+
+
+def test_load_config_unreadable_file(tmp_path, monkeypatch, capsys):
+    """Test graceful fallback when config file exists but cannot be read."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    config_path = tmp_path / ".config" / "task-cli" / "config.yaml"
+    config_path.parent.mkdir(parents=True)
+    config_path.write_text("storage_dir: /custom/path\n")
+    config_path.chmod(0o000)
+
+    config = load_config()
+
+    assert config == DEFAULT_CONFIG
+    captured = capsys.readouterr()
+    assert "Warning" in captured.err
+    # Restore permissions for cleanup
+    config_path.chmod(0o644)
+
+
+def test_load_config_no_crash_without_config(tmp_path, monkeypatch):
+    """Test the core issue: CLI does not crash when config file is missing."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    config_path = tmp_path / ".config" / "task-cli" / "config.yaml"
+    assert not config_path.exists()
+
+    # Should not raise any exception
+    config = load_config()
+
+    assert isinstance(config, dict)
+    assert "storage_dir" in config
+    assert "default_format" in config
+
+
+def test_get_config_path(tmp_path, monkeypatch):
+    """Test that config path is under .config/task-cli."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    path = get_config_path()
+
+    assert path == tmp_path / ".config" / "task-cli" / "config.yaml"
+
+
+def test_parse_config_empty():
+    """Test parsing empty config text."""
+    assert _parse_config("") == {}
+
+
+def test_parse_config_comments_only():
+    """Test parsing config with only comments."""
+    assert _parse_config("# comment\n# another") == {}
+
+
+def test_parse_config_multiple_keys():
+    """Test parsing config with multiple keys."""
+    text = "storage_dir: /data\ndefault_format: json\n"
+    result = _parse_config(text)
+    assert result == {"storage_dir": "/data", "default_format": "json"}
+
+
+def test_parse_config_value_with_colon():
+    """Test parsing config where value contains a colon."""
+    text = "storage_dir: /path/to:something\n"
+    result = _parse_config(text)
+    assert result == {"storage_dir": "/path/to:something"}
+
+
+def test_parse_config_whitespace_handling():
+    """Test that keys and values are stripped of whitespace."""
+    text = "  storage_dir :  /data  \n"
+    result = _parse_config(text)
+    assert result == {"storage_dir": "/data"}
+
+
+def test_parse_config_blank_lines():
+    """Test that blank lines are skipped."""
+    text = "key1: val1\n\n\nkey2: val2\n"
+    result = _parse_config(text)
+    assert result == {"key1": "val1", "key2": "val2"}
+
+
+def test_load_config_creates_parent_dirs(tmp_path, monkeypatch):
+    """Test that missing parent directories are created when writing default config."""
+    monkeypatch.setattr(Path, "home", lambda: tmp_path)
+
+    parent = tmp_path / ".config" / "task-cli"
+    assert not parent.exists()
+
+    load_config()
+
+    assert parent.exists()
+    assert parent.is_dir()
+
+
+def test_default_config_text_matches_default_config():
+    """Test that DEFAULT_CONFIG_TEXT parses to DEFAULT_CONFIG."""
+    parsed = _parse_config(DEFAULT_CONFIG_TEXT)
+    assert parsed == DEFAULT_CONFIG