IRS Proposes E-Delivery for Crypto Tax Forms, But Staking Tax Issue Lingers

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IRS proposes electronic crypto tax forms, but what about the staking tax issue?

The U.S. Treasury and the IRS are suggesting that companies dealing in cryptocurrency automatically send tax forms to their customers electronically.

The IRS is looking to simplify how cryptocurrency is taxed, and is planning to make it easier for exchanges and other platforms to report information.

Right now, the IRS asks brokers to send two different crypto tax forms: one to the government and another to their customers.

Customers who don’t receive tax information by email will have their forms sent to them by mail. For exchanges with over a million users, this means sending over a million paper tax forms each year, which creates a significant expense and makes staying compliant with regulations difficult.

The IRS is considering a new plan to stop mailing paper tax forms for cryptocurrency and instead deliver them automatically by email. Interested parties have 60 days to share their thoughts on this proposal before the IRS finalizes its instructions.

Will crypto staking tax be resolved?

Although brokers might appreciate stricter rules for reporting crypto taxes, some problems still need to be addressed. One example is that Americans who earn rewards by staking cryptocurrency currently have to pay taxes on those rewards twice.

The IRS currently considers rewards from crypto staking as taxable income. This means if you earn crypto like 1 Ethereum (currently worth around $2000) through staking, you’ll need to pay income tax on that amount when you receive it.

If you keep holding the asset and sell it later, perhaps when Ethereum’s price rises to $4,000, you’ll also have to pay taxes on any profits you make.

Congressman Mike Carey is urging the Treasury Department and the IRS to provide clear guidance and potential tax relief for cryptocurrency staking. He recently questioned IRS officials during a House committee hearing, seeking the same clarification.

The United States should lead the world in cryptocurrency. To achieve this, our tax laws need to be updated, particularly regarding how we treat individuals and businesses that stake or mine crypto.

Frank Bisignano, head of the IRS, stated he will soon update the legislator on the current reviews of cryptocurrency staking rewards and explain how the IRS plans to handle them for tax purposes.

It’s still unclear if the IRS review will provide tax breaks for cryptocurrency miners and stakers. However, some believe that being taxed twice on the same crypto could lead more investors to move their operations to countries with more favorable tax laws for staking.

Final Summary

  • The IRS has proposed an overhaul of the crypto tax reporting regime that seeks to scrap out mailing of paper-based crypto tax forms and opt for e-mail by default. 
  • Congressman Mike Carey is pushing the IRS to table crypto tax reviews to resolve the current double taxation of mining and staking rewards.  

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2026-03-06 12:55