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How is staking income taxed?
Staking income is the reward you receive for locking up coins to help validate a proof-of-stake blockchain. In the US, the IRS treats these rewards as ordinary income, valued at fair market value when you gain control of them, whether you stake directly or through an exchange.
What it means for you
In the US, staking rewards can count as income in the tax year you can first sell or move them, even if you keep them and their price later falls, so the date and dollar value of each reward matter. Selling or swapping the rewarded coins later is a separate taxable event.
How it works
Revenue Ruling 2023-14 addresses a cash-method taxpayer who stakes a proof-of-stake coin and receives new units when validation occurs. Income arises when the taxpayer gains dominion and control — the ability to sell, exchange or otherwise dispose of the rewards — not while the protocol still locks them. The amount is fair market value at that date and time. The ruling applies equally to staking through an exchange, and notes staked units can be forfeited through slashing if validation fails. Separately, the SEC's 2026 interpretation says protocol staking as it describes does not involve the offer and sale of a security.
An example
Say you stake coins and receive 2 reward coins that you can sell from a given day, when each is worth $50. In the US, under Revenue Ruling 2023-14, that puts $100 of ordinary income in that tax year, even if you keep both coins.
Sources: IRS: Revenue Ruling 2023-14 (staking rewards), IRS: Digital assets, SEC and CFTC: Application of the Federal Securities Laws to Certain Types of Crypto Assets (Release 33-11412, 2026) · checked 4 October 2026
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