The IRS claims that crypto staking should be taxed in a lawsuit

ChainCatcher news, according to Bloomberg, the Internal Revenue Service (IRS) stated in a lawsuit that staking cryptocurrency should immediately create a tax obligation upon completion.

The IRS dismissed the lawsuit filed by cryptocurrency investor Joshua Jarrett in the U.S. District Court for the Middle District of Tennessee. The lawsuit concerns the tax treatment of staking, which is the process of generating new tokens by using existing tokens and computing power to validate currency transactions.

In a response on December 20, the IRS denied that staking creates new property and argued that the taxpayer (Jarrett) should pay taxes on the value of the tokens when he receives the staking rewards.