Restaking Tax Calculator 2026 β€” EigenLayer, AVS & LRT Layered Rewards

Calculate federal income tax on liquid restaking rewards across all layers: base ETH staking APR, EigenLayer AVS rewards, and LRT token distributions. Includes LRT swap tax events and slashing capital losses.

ETH
$
%
~3–4% typical for Ethereum staking
%
Additional restaking rewards from AVS operators
%
weETH, ezETH, rsETH, etc. distributions
$
W-2 or other income (for marginal rate calc)
$
$
FMV when LRT was originally received (your basis)
$0
Total Annual Tax
$0
Total Reward Income
$0
LRT Swap Capital Gains Tax
0%
Effective Rate on Rewards

Layer-by-Layer Tax Breakdown

How Liquid Restaking Income Is Taxed

EigenLayer-style liquid restaking creates multiple simultaneous income streams, each taxable as ordinary income at fair market value when received. Layer 1 (base ETH staking) is ordinary income. Layer 2 (AVS rewards) is also ordinary income β€” these are typically distributed as AVS tokens at FMV on the distribution date. Layer 3 (LRT token distributions like weETH appreciation or point allocations) are ordinary income at receipt. When you later swap or sell LRT tokens, that disposal triggers capital gains or losses.

The Formula

Base Staking Income = ETH Γ— ETH Price Γ— Base APR
AVS Income = ETH Γ— ETH Price Γ— AVS APR
LRT Income = ETH Γ— ETH Price Γ— LRT APR
Total Ordinary Income = Base + AVS + LRT (no SE tax β€” passive)
LRT Capital Gain = Sale Proceeds βˆ’ Cost Basis (STCG or LTCG)
Federal Tax = Marginal Rate Γ— Ordinary Income + Cap Gains Rate Γ— LRT Gain

Example

32 ETH @ $3,500, Base 3.5%, AVS 4%, LRT 2%, $120K other income, single:
Base income: 32 Γ— $3,500 Γ— 3.5% = $3,920
AVS income: 32 Γ— $3,500 Γ— 4% = $4,480
LRT income: 32 Γ— $3,500 Γ— 2% = $2,240
Total ordinary income: $10,640 (taxed at ~32% marginal) = $3,405
No SE tax (passive income)
Extended

Multi-Layer Restaking Reward Ledger & Projection

Input each reward layer separately, track LRT swap events, and see a stacked SVG bar chart of your total tax by layer with multi-year projections

Build a detailed per-layer reward ledger. Track each reward source separately with individual recognition dates and amounts. Model multi-year projections.

Reward Layer Inputs

$
years

Tax Stack Per Reward Layer (Annual)

Multi-Year Projection

YearTotal Reward IncomeMarginal RateIncome TaxNet After Tax

Frequently Asked Questions

What is liquid restaking and how is it taxed?
Liquid restaking (e.g., EigenLayer) involves restaking ETH across multiple Actively Validated Services (AVS) to earn additional yield on top of base staking rewards. Each layer of rewards β€” base ETH staking, AVS rewards, and LRT token distributions β€” is treated as ordinary income at fair market value when received (IRS Rev. Rul. 2023-14). The cumulative tax exposure is significantly higher than simple ETH staking due to multiple simultaneous income streams.
Are LRT token swaps taxable events?
Yes. When you swap or redeem a Liquid Restaking Token (LRT) such as weETH, ezETH, or rsETH, it is a taxable disposal of property. You recognize capital gain or loss equal to the difference between the FMV at disposal and your cost basis (FMV when you received the LRT). Short-term rates apply if held under 12 months. This is in addition to the ordinary income recognized when the LRT was originally issued to you.
Is restaking income subject to self-employment tax?
No. Restaking rewards β€” whether base staking, AVS rewards, or LRT distributions β€” are generally classified as passive investment income, not self-employment income. They are taxed as ordinary income but are not subject to SE tax (15.3%). This is similar to traditional staking rewards and DeFi yield. Mining income, by contrast, may be subject to SE tax if operated as a trade or business.
How does slashing create a tax deduction?
If your ETH is slashed by an AVS (e.g., for downtime or double-signing), the lost ETH creates a capital loss. The amount of the loss equals the FMV of the slashed ETH at the time of slashing. This capital loss can offset capital gains first; any excess can offset up to $3,000 of ordinary income per year, with the remainder carried forward indefinitely.
When do AVS reward tokens become taxable?
AVS reward tokens become taxable when you receive them and have dominion and control β€” typically when they are claimable or distributed to your wallet. The FMV at the time of receipt establishes both the taxable income amount and your cost basis for future capital gains purposes. If the tokens are locked or cannot be accessed, taxability may be deferred until you have actual control. Keep detailed records of each distribution event and the token price at that time.