Overview

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Tezos network stakers Josh Jarrett and his wife Jessica Jarrett have again filed a lawsuit against the United States Internal Revenue Service over its tax treatment of Per the latest development, the Internal Revenue Service has filed to dismiss the lawsuit by arguing that the Tezos staking couple had no right to refuse the refund that was Tezos baker Josh Jarrett has sued the IRS for tax imposed on XTZ tokens earned for staking. Crypto advocacy think-tank Coin Center is backing the lawsuit to ensure The Department of Justice has urged a judge to dismiss a Nashville couple’s bid to take a dispute over taxes related to unsold Tezos tokens to court. In December 2025, the IRS offered to Plaintiffs, Joshua and Jessica Jarrett, file this complaint against the United States of America pursuant to 26 U.S.C. §74 U.S.C. §6532, and allege as follows: 1.

Tezos Staking Couple IRS Lawsuit: Agency Files to Dismiss Case

The legal battle between the IRS and Tezos network stakers Josh Jarrett and his wife Jessica Jarrett continues, as the Internal Revenue Service has filed to dismiss the lawsuit over its tax treatment of Tezos staking rewards. This case has significant implications for the cryptocurrency industry, particularly regarding the taxation of staking rewards.

Background: The Tezos Staking Dispute

Tezos baker Josh Jarrett initially sued the IRS for tax imposed on XTZ tokens earned for staking. The core of the dispute revolves around whether newly created tokens from staking should be taxed as income upon receipt, or only when sold. Crypto advocacy think-tank Coin Center is backing the lawsuit to ensure a fair and consistent application of tax laws to cryptocurrency staking activities.

In December 2025, the IRS offered a refund to Plaintiffs, Joshua and Jessica Jarrett, for the tax they paid on the staking rewards. However, they refused the refund, seeking a court ruling on the broader issue. As stated in the original complaint: "Plaintiffs, Joshua and Jessica Jarrett, file this complaint against the United States of America pursuant to 26 U.S.C. §74 U.S.C. §6532, and allege as follows: 1."

IRS Files to Dismiss: Argument & Rebuttal

Per the latest development, the Internal Revenue Service has filed to dismiss the lawsuit by arguing that the Tezos staking couple had no right to refuse the refund that was offered. The Department of Justice has urged a judge to dismiss the couple’s bid to take the dispute over taxes related to unsold Tezos tokens to court. The IRS\'s position is that because the Jarretts were offered a full refund, the case is moot.

Implications for Tezos and Crypto Staking

The outcome of this Tezos staking IRS lawsuit is crucial for the future of crypto staking taxation. A victory for the Jarretts could set a precedent that newly minted tokens are not taxable until sold, providing clarity for stakers across various blockchain networks. Conversely, a dismissal or loss for the Jarretts could reinforce the IRS\'s view that staking rewards are taxable income upon receipt.

Stay Updated on the Tezos Staking Lawsuit

This case is actively developing. We will continue to provide updates on the Tezos staking couple\'s IRS lawsuit and its impact on the broader cryptocurrency landscape. Check back for more information as it becomes available.

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