The U.S. Internal Revenue Service (IRS) has reaffirmed its stance on the immediate taxability of staking rewards, doubling down on a position assumed in 2023 as part of internal guidelines. In a recent filing related to an ongoing lawsuit, the service argues that the rewards generated through staking do not constitute new property and should be taxed as soon as they are issued, in contrast to how new crops and similar goods are taxed. Joshua and Jessica Jarrett, a Tennessee couple, have been waging this battle against the IRS since 2021, proposing that these rewards should be taxed only when sold. The lawsuit could potentially establish a precedent for this kind of activity.

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