US Lawmakers Push IRS to Revisit Crypto Staking Tax Rules Before 2026

A bipartisan group of 18 US House lawmakers, led by Rep. Mike Carey (R-OH), sent a letter on December 19, 2025, to IRS acting commissioner Scott Bessent urging a review of current staking rewards taxation. They argue the 2023 IRS guidance—treating rewards as taxable income upon receipt—creates “double taxation” (income tax at receipt, capital gains at sale) and burdensome compliance, discouraging participation in proof-of-stake networks essential for blockchain security.

The lawmakers propose taxing rewards only upon sale, aligning with realized economic gains and reducing administrative hurdles without undermining revenue. They emphasize US leadership in digital assets requires broader staking involvement, with millions of Americans holding relevant tokens.

This push aims to update guidance before year-end to avoid locking in rules for 2026 tax filings. Separately, Reps. Max Miller (R-OH) and Steven Horsford (D-NV) released a discussion draft of the **Digital Asset PARITY Act** on December 20, proposing a five-year optional deferral for staking/mining rewards (taxed as income at fair market value after deferral), alongside a $200 capital gains exemption for qualified stablecoin transactions.

Industry welcomes the efforts, viewing clearer rules as vital for innovation amid over $100 billion staked globally. No IRS response yet; changes could significantly ease “phantom income” issues for stakers.