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No precedent: IRS court settlement doesn't clarify crypto staking taxes

Published 02/08/2022, 09:07 AM
Updated 02/08/2022, 10:40 AM

In May 2021, a Nashville couple known as the Jarretts filed a lawsuit against the United States Internal Revenue Service (IRS) over taxes they had paid on unclaimed and unsold Tezos (XTZ) staking rewards. At the beginning of February, news broke that the lawsuit filed by the Jarretts had come to an end, resulting in the IRS issuing the couple a tax refund for $3,793.

Not long after this news made headlines, confusion among the crypto community piqued. One crypto media publication sent a tweet from its official account on Feb. 2, 2022, saying, “BREAKING: IRS will not tax unsold staked crypto as income.” The tweet generated over 4,000 retweets and over 18,000 likes, as Crypto Twitter (NYSE:TWTR) rejoiced over the assumed notion that the IRS would not tax unsold staked crypto.

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