A U.S. taxpayer fighting the Internal Revenue Service (IRS) over whether newly created tokens are taxable income announced Thursday that he has rejected the government’s offer of a refund in order to force the government to clarify its policy.
Fast facts
- On Thursday, Joshua Jarrett shared on Twitter that the IRS had offered him a full refund of US$3,793 plus interest last December, but “the IRS will also apparently not provide any assurances with respect to the sole issue that gave rise to this matter.”
- The Tennessee gym owner and cryptocurrency investor paid tax on tokens he was rewarded by staking in proof-of-stake blockchain Tezos in 2019.
- He later petitioned for a refund, on the grounds that the tokens were new property and should not be taxed as income until the tokens are sold.
- In a May 2021 federal complaint, he said he didn’t receive a response from the IRS and was forced to sue the government agency.
- The case is expected to go to court in March 2023.
- Jarrett is supported by the Proof of Stake Alliance, which has been lobbying Congress for clarification on taxation of staking rewards.