#USCryptoStakingTaxReview

📌 1. How the IRS Currently Treats Staking Rewards (2025)

IRS Revenue Ruling 2023-14 — the main authority right now — says:

📍 Staking rewards are taxable as ordinary income at the moment you gain “dominion and control” over the tokens — meaning you can freely sell, transfer, or otherwise use them. The taxable amount is the fair market value in U.S. dollars at that time.

✔ That’s true whether you stake directly on a PoS blockchain or via an exchange.

📌 In practice:

When the rewards hit your wallet or are available for withdrawal = taxable income.

That amount becomes your cost basis for later sale.

tres.finance

🔥 Because the IRS treats the rewards as ordinary income, not capital gains, you pay regular income tax rates (10–37% federally, plus possible state tax).

tres.finance

📌 2. Double Taxation Debate

Right now, stakers are often taxed twice:

When rewards are received — as income.

When those same rewards are later sold or traded — as capital gains (gain/loss relative to the value at receipt).

MoneyCheck

🔎 Many taxpayers complain this amounts to double taxation on the same token

New bipartisan effort:

A group of 18 U.S. House members sent a letter to the IRS asking for a review of current staking tax rules before 2026. They argue existing rules are burdensome and unfair because of double taxation. Their proposal would tax rewards only when sold, aligning tax events with actual economic gain instead of at receipt.

👉 If successful, this could be a major shift — but nothing has formally changed yet.

📌 4. Institutional / Trust-Level Guidance

In November 2025, the IRS issued Revene Procedure 2025-31 which creates a safe harbor for certain trusts engaging in staking. This guidance helps trusts avoid losing favorable tax status while staking, providing clarity for institutional participation.

This doesn’t directly change individual tax rules yet