US Crypto Staking Tax Review:

In the US, staking rewards are considered taxable income when you gain control over them, meaning when you can transfer or spend them. You'll report this income on Form 1040 Schedule 1 as "Other Income" ¹ ².

*Key Tax Implications:*

- _Income Tax_: Staking rewards are taxed as ordinary income at the time of receipt, based on the fair market value in USD.

- _Capital Gains Tax_: When you dispose of staking rewards, you'll pay capital gains tax on any gains, reported on Form 8949 and Schedule D.

- _Reporting Threshold_: There's no minimum threshold for reporting staking income; even small rewards must be reported ² ¹ ³.

*Proposed Legislative Changes:*

The Digital Asset PARITY Act proposes a five-year deferral period for staking rewards, taxing them as ordinary income only after this period. The bill also aims to exempt small crypto transactions from capital gains tax and apply wash sale rules to crypto ⁴ ⁵.

*IRS Guidance and Forms:*

- Form 1099-DA will be used to report digital asset sales and income, including staking rewards, starting in 2026.

- The IRS has clarified that staking rewards are taxable income when received, and cost basis must be tracked separately for each wallet or account ² ⁶.

Would you like to know more about the proposed legislative changes or how to report staking income on your tax return?

#usstakingtxreview #Ripple1BXRPReserve #FedOfficialsSpeak #BinanceAlphaAlert #CPIWatch