Staking rewards are taxed as ordinary income the moment you gain dominion and control over them — separately from any later capital gain or loss when you eventually sell.
How it works
Tokens received times their fair market value at receipt gives ordinary income, taxed at your marginal rate. That same value becomes your cost basis, so a later sale’s capital gain is the sale proceeds minus that basis.
What this does not include
This does not include state tax treatment, self-employment tax considerations for those staking as a business, or the holding-period rules that determine whether a later gain is short- or long-term.
How to use this calculator
- Enter tokens received, their value at receipt, your marginal tax rate, and (optionally) a later sale price.
A worked example
100 tokens received from staking at $2 fair market value each, 24% marginal tax rate: ordinary income = $200, tax owed at receipt = $48, cost basis = $200. Selling later at $3/token: capital gain = $100 on top of the $200 already taxed as income.
What the variables mean
| Variable | Meaning |
|---|---|
| Tokens received | Staking rewards received |
| FMV at receipt | Fair market value per token when received |
| Marginal tax rate | Tax rate applied to the ordinary income from receiving the tokens |
| Sale price per token | Price if and when the tokens are later sold |
Edge cases worth knowing
Staking rewards are taxed twice, at two different times, on two different bases. The value at receipt is ordinary income immediately, and the cost basis is set at that same value — any further price movement after receipt is a separate capital gain or loss when eventually sold.
A negative token count has no meaning, so the calculator declines to show a result for that input.
Frequently asked questions
Is staking income taxed differently from mining income?
Both are generally taxed as ordinary income at fair market value when received, though mining can additionally trigger self-employment tax if conducted as a trade or business.
What if I never sell the staked tokens?
You still owe ordinary income tax on the reward at receipt — the tax event happens when you gain control of the tokens, not when you sell them.
Does this apply to liquid staking derivatives?
The IRS guidance addresses staking rewards generally; liquid staking and other newer structures may raise additional questions best reviewed with a tax professional.
