IRS issues guidance on digital asset staking safe harbor for trusts
The IRS issued Revenue Procedure 2026-20 on Oct. 6 and replaced Revenue Procedure 2025-31 with a new safe harbor for qualifying investment and grantor trusts that stake proof-of-stake digital assets. The update sets 14 conditions for eligible trusts and is framed around preserving their federal income tax classification while staking.
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Trusts that qualify under the new procedure now have a defined set of staking rules to follow, and that is the detail that matters for their administrators and custodians starting today. The change is specific to investment trusts and grantor trusts that hold proof-of-stake digital assets, and it leaves the tax classification point tied to the trust’s eligibility under the safe harbor.
Before this update, the relevant framework was Revenue Procedure 2025-31; now Revenue Procedure 2026-20 stands in its place with 14 conditions attached. In practice, staking is no longer being described under the old procedure for these qualifying trusts, while the basic category of trusts covered remains investment trusts and grantor trusts.
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