included in this would be reflections, coinbase earn type rewards and rewards from staking various tokens and coins, not have been sold or traded for another easily liquid coin like BTC or ETH, they simply remain in the receiving wallet or begin earning after maturation.
My entire question is really not showing - the actual question is:
I'm confused:
Staking rewards are taxed ON the date RECEIVED is taxed like regular income,
included in this would be reflections, Coinbase earn type rewards and rewards from staking various tokens and coins, not have been sold or traded for another easily liquid coin like BTC or ETH, they simply remain in the receiving wallet or begin earning after maturation.
THEN, once liquidated you are taxed AGAIN. How is this NOT a double dip for the IRS?
You are not double taxed on this because you are only taxed on the amount above your basis in the asset. So if you received $1,000 in Staking Rewards and that was included in your income, then you reinvest for a month then liquidate at $1,200 you would only be taxed on the gain of $200, not the full $1,200.