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Josh Jarrett, the co-founder of Tezos, and his wife, Jessica Jarrett, have filed a renewed lawsuit in the Tennessee Federal Court against the IRS regarding their stance on the taxation of staked XTZ tokens. The couple argues that newly minted tokens earned through staking should only be taxed upon sale, asserting that these new assets should not be subject to taxation until they are sold.
Details of the Lawsuit
The Jarretts previously sued the IRS in 2021 with similar arguments, seeking a refund for taxes paid on staked XTZ tokens. This previous lawsuit concluded with a $4,000 settlement offer that the Jarretts rejected.
This time, they aim not only to address staked tokens but also to permanently stop the IRS from classifying newly created crypto assets as income.
Support from Coin Center
Coin Center, a supporter of the Jarretts’ case, emphasizes the significance of this legal battle for the future of cryptocurrency and decentralized technologies. They state, “For proof of stake, this tax issue applies to everyone.”
As discussions continue regarding how the IRS classifies and taxes crypto assets, the Jarretts’ legal process aims to reduce uncertainties in this area.
The outcome of this case could impact all crypto holders who engage in staking and shape the relationship between the IRS and the crypto community.
In conclusion, the Jarretts’ lawsuit could significantly influence crypto taxation policies and serve as a precedent for other crypto holders facing similar situations.
