# Lending Rewards

## What is a Lending Reward?

Lending rewards are received in exchange for loaning out a cryptoasset. 

## How are Lending Rewards Taxed?

{% hint style="danger" %}
There is no IRS guidance on lending rewards, so you would need to examine the details of the transactions you are undertaking to determine the tax treatment.
{% endhint %}

### Income Tax

Following the IRS' tax treatment of staking, it seems clear that lending rewards will be subject to income tax. The USD value of the rewards (usually crypto tokens) at the date of receipt will be the value of the taxable miscellaneous income.

### Capital Gains Tax

The USD value of the reward at the date of receipt is the capital gains tax acquisition cost of the tokens; to be deducted from the proceeds of a later disposal of the tokens (which is subject to capital gains tax).

## Lending Rewards in [Recap](https://recap.io/)

![](/files/shUmeaNCRxqftZLmQWTR)

##


---

# Agent Instructions: Querying This Documentation

If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question.

Perform an HTTP GET request on the current page URL with the `ask` query parameter:

```
GET https://docs.recap.io/us-tax-guide-for-individuals/transaction-types/lending-rewards.md?ask=<question>
```

The question should be specific, self-contained, and written in natural language.
The response will contain a direct answer to the question and relevant excerpts and sources from the documentation.

Use this mechanism when the answer is not explicitly present in the current page, you need clarification or additional context, or you want to retrieve related documentation sections.