US Lawmakers Push IRS to Revisit Crypto Staking Tax Rules Ahead of 2026

A bipartisan group of 18 US House lawmakers is calling on the IRS to reconsider how crypto staking rewards are taxed, urging action before the start of 2026. The request was outlined in a letter to IRS acting commissioner Scott Bessent, signaling growing pressure from Washington to modernize digital asset tax treatment.

The letter was led by Republican Representative Mike Carey and focuses on what lawmakers describe as outdated and burdensome guidance around staking rewards. Under current rules, many taxpayers have to report staking rewards as income while receiving and again while selling, which can result in higher tax exposure even if the token price later declines.

Carey said the request centers on fairness rather than preferential treatment. He noted that ending what lawmakers view as double taxation would better align crypto taxes with actual gains realized by users.

Push to Tax Rewards at Sale, Not Receipt

At the core of the proposal is a call to shift taxation of staking rewards to the point of sale. Lawmakers argue that this approach would ensure staking taxation happens based on real economic outcomes rather than paper gains. According to the letter, taxing rewards only when sold would reduce complexity and lower the reporting burden for individuals who help secure blockchain networks.

The group also warned that the current framework discourages participation in staking, even though staking plays a central role in maintaining the security of many blockchain systems. They stressed that millions of Americans hold tokens on networks that rely on staking and that discouraging this activity could weaken both network resilience and broader US competitiveness in digital assets.

The lawmakers asked the IRS whether any procedural hurdles stand in the way of updating the guidance before the end of the year. They also framed the request as consistent with the administration’s stated goal of strengthening the country’s position in digital asset development.

Other Efforts Target Broader Crypto Tax Relief

This is not the only recent effort to revise crypto tax policy. On Saturday, Representatives Max Miller and Steven Horsford introduced a discussion draft aimed at easing tax obligations for crypto users. Their proposal includes exempting small stablecoin transactions from capital gains taxes and offering a deferral option for staking and mining rewards.

Unlike Carey’s letter, this draft does not seek an immediate overhaul of staking taxation. Instead, it would allow taxpayers to choose to defer income recognition on staking or mining rewards for up to five years. During that period, taxes would not be due until asset sell-off or the deferral window expiration.