They requested a refund of $12,179 for taxes paid on 13,000 XTZ tokens earned in the 2020 tax year and a permanent injunction against the IRS’s current tax treatment of their tokens. The Jarretts’ case presents a significant challenge to the IRS’s approach, arguing that newly created property from staking should not constitute taxable income until it is sold, contrasting sharply with the IRS’s current policy. The outcome of the Jarretts’ legal battle has the potential to set a crucial precedent for the taxation of staking rewards and possibly other forms of newly created digital assets in the United States.