> For the complete documentation index, see [llms.txt](https://docs.recap.io/us-tax-guide-for-individuals/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.recap.io/us-tax-guide-for-individuals/transaction-types/reflections-rewards.md).

# Reflections Rewards

![](/files/uiaWzlx3epMUElHrfC2d)

## What are Reflections Rewards?

In general, ‘reflections’ tokens appear to pay the holder a reward (more of the same token) every time someone else makes a transaction in that token. The tokens are pre-determined to pay out this reward to holders (usually referred to as a tax on transactions).

### Income Tax

{% hint style="danger" %}
There has been no official guidance on reflection rewards from the IRS and as such we recommend that you speak with your tax attorney or accountant about the best way to file your return.
{% endhint %}

Whilst there has been no official guidance from the IRS about the treatment of reflection rewards - given their similarity to [Airdrops](/us-tax-guide-for-individuals/transaction-types/airdrops.md), we believe the taxation treatment should be similar.


---

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