How Staking and Mining Rewards Are Taxed
Staking and mining rewards are among the most misunderstood crypto events. The key: there are usually two taxable moments.
Income at receipt
Rewards are generally ordinary income at fair market value when the taxpayer gains dominion and control. The IRS addressed mining in Notice 2014-21 and has since issued guidance on staking.
Capital gain at sale
When the client later sells the rewarded coins, the change in value from the receipt date is a capital gain or loss — reported on Form 8949.
Capture reward statements during intake so the receipt-date value (and basis) is never lost.
For protocol-level complexity, see our DeFi tax guide.
Frequently asked questions
When are staking rewards taxed?+
Staking rewards are generally taxed as ordinary income at their fair market value when the taxpayer gains dominion and control over them.
Are mining rewards taxed twice?+
Effectively there are two events: ordinary income at receipt, then a capital gain or loss based on the change in value when the coins are later sold.
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