Somewhat OT, but sorta relevant :Taxation of virtual assets

[Terminus]

ORIGINAL: captskillet

Im sure I would wind up in a Federal Pen somewhere but I think I would have to tell them to kiss my virtual a**! [:-] [;)]

Don't mess with the IRS... Tax evasion is what they nailed Capone on...

[Tetsuo]

Don't mess with the IRS... Tax evasion is what they nailed Capone on...

They'll never take me alive!

[saj42]

ORIGINAL: rtrapasso

i can see it now:

IRS: "OK, you made this mod for WITP, and in it you gave the Japanese player two extra aircraft carriers. Now, adjusted from 1941 rates for inflation, we figure they would be worth about $350,000,000 dollars each, for a total of $700,000,000.00. We figure you owe a "gift tax" on $699,990,000.00. With past due penalties and interest from 1941, that is $198.2 billion real dollars. How would you like to arrange payment?" [X(] [:D]

[:D][:D][:D]

This is great. As Japan I know I can't beat the Allies materially, so I beat him financially.
Must sink as many of the US CAs as I can so my opponent gets huge tax demands for those respawned ships. He'll have to sue for peace 'cos he can't fight the war from a prison cell when he fails to pay up. I'll call it Operation IRS [;)]

[Przemcio231]

People are totaly dumb to pay for lets say RPG characters for some on-line games , i also heard that some people's were trading items for Diablo 2 when it was popular... how retorted can one be to pay real cash for some item in the game[:D][:D][:D]

[Feinder]

While I shake my head as well Prz, it does happen all the time. It's extrememly difficullt to get a real handle on the "virtual industry", but I've read articles that estimate the "value" of the on-line game economies to be nearly a billion dollars a year (which is about the value of the game market itself!).

Recent issue of PC Gamer magazine profiled a "company" in China who employs 60 - 100 persons, that litterally all they do is play the World of Warcraft, and sell their items to players. There are many companies just like it.

Why would a player pay real money for virtual items? Again, while I would not, I can see some of the justification...

a. Believe it or not, the the largest purchasing power in the gaming market is the 25 - 35 year old group. On-line games require a credit card (or Mom & Dad's). 25 - 35 year olds have the money to spend. But they may not have the TIME, so...
b. If you're a young professional who wants to play with all the cool toys, but don't have the time to get them, just buy them.
c. If you're a young professional who doesn't have the time to level up to "the really cool stuff", just pay somebody to level up a character for you.
d. If you take a break from the game, and all your virtual friends have kept levelling (you're now 6 months "behind"), pay somebody to level your character and/or get the items you need to close the gap.
e. Same as E, except maybe your friends convince you to start the game, so you pay somebody to "catch up" to thier characters so you can all group together.

People give all sorts of reasons. It doesn't matter what we think (that it's stupid). The truth is there is LOT of (real) money changing hands over virtual items.

-F-

[TulliusDetritus]

So it's official? The white sharks have smelled the blood? [8D]

[wdolson]

ORIGINAL: Kid

The whole idea of taxing virtual property is crap. Its just another way for the government to put their hand in your pocket. I say if they can start taxing virtual money, then we should be able to pay in virtual money. Either that or I'll stop playing altogether. Why don't they tax Monopoly money? I mean there are probably millions of Monopoly players, why doesn’t the IRS monitor each game and make players pay a tax each time they make a transaction. The world is becoming a crazy place.

The difference is that I have not heard of anybody trading Monopoly money for real money. When real money is exchanged for something, whether physically tangible, or virtual, the IRS wants a cut of the transaction. If a large enough number of people are trading something so that it has a fairly stable value, even if no US currency trades hands, the IRS assumes that something of value that could be traded for US currency has traded hands and they want a piece of it.

Technically, the IRS does not care if the income was legal or not. Drug dealers are just as subject to IRS rules as the rest of us. There have been cases where the IRS has slapped drug dealers with big bills when they showed up on the radar. As someone else pointed out, they eventually got Capone on tax evasion.

This trade in game assets is essentially a new form of software. We pay money for computer software. Some of it, such as Linux is free, and people pirate it, but most computer software is sold to customers. We are buying something virtual there too. You aren't paying much for the CD it comes on. A disc with an old game on it might be $10 in the bargain bin, but a disc of exactly the same quality with Adobe Photoshop on it would be several hundred dollars. You can even download the content after paying for it.

I hate the IRS just as much as every American. I can see where there are precedents for this though.

Bill

[Charbroiled]

ORIGINAL: Feinder

Why would a player pay real money for virtual items? Again, while I would not, I can see some of the justification...

Feinder....I have a slightly used Jap CV, complete with air units (exp. 80+) I'll sell you for $20.[:D][:D][:D]

[Feinder]

Now, now charbroiled.  I'm not sure if you remember when they had air-fragments changing sides in WitP.
 
I'm sure a CV changing sides would cause serious havoc with the code! 
 
Now if only I could mule my own CVs from one game to another...
 
Hmmm...
 
-F-

[AU Tiger_MatrixForum]

ORIGINAL: Feinder


Otherwise, payment could be made, and seller never gives up item.


-F-

Welcome to Ebay. I bought a book, only $4.50 thank goodness. It never shipped. I filed a grievance. I won said grievance. Ebay said to collect it from the seller.[&:]

Ebay BAD!!!!!
[:-]

[Knavey]

ORIGINAL: Feinder

I have no idea what the $2 is for. I know in some MMORPGs, there are middle-man "companies" (guilds) that act pass the item(s) from the seller to the buyer once payment is made.

1. Seller gives item to trusted middle-man.
2. Buyer makes payment.
3. Middle-man gives items to buyer.

Otherwise, payment could be made, and seller never gives up item.

The $2 could well be a payment to the middle-man guild. I have no idea tho. I never bought anything in-game (altho Dave, did you know our idiot-brother Paul used to buy stuff in AC2?).

-F-

Nope,

Didn't know that...gonna have to give him a ration of poo over that.

[siRkid]

ORIGINAL: wdolson

ORIGINAL: Kid

The whole idea of taxing virtual property is crap. Its just another way for the government to put their hand in your pocket. I say if they can start taxing virtual money, then we should be able to pay in virtual money. Either that or I'll stop playing altogether. Why don't they tax Monopoly money? I mean there are probably millions of Monopoly players, why doesn’t the IRS monitor each game and make players pay a tax each time they make a transaction. The world is becoming a crazy place.

The difference is that I have not heard of anybody trading Monopoly money for real money. When real money is exchanged for something, whether physically tangible, or virtual, the IRS wants a cut of the transaction. If a large enough number of people are trading something so that it has a fairly stable value, even if no US currency trades hands, the IRS assumes that something of value that could be traded for US currency has traded hands and they want a piece of it.

Technically, the IRS does not care if the income was legal or not. Drug dealers are just as subject to IRS rules as the rest of us. There have been cases where the IRS has slapped drug dealers with big bills when they showed up on the radar. As someone else pointed out, they eventually got Capone on tax evasion.

This trade in game assets is essentially a new form of software. We pay money for computer software. Some of it, such as Linux is free, and people pirate it, but most computer software is sold to customers. We are buying something virtual there too. You aren't paying much for the CD it comes on. A disc with an old game on it might be $10 in the bargain bin, but a disc of exactly the same quality with Adobe Photoshop on it would be several hundred dollars. You can even download the content after paying for it.

I hate the IRS just as much as every American. I can see where there are precedents for this though.

Bill

If they only want to tax e-items bought for real cash, I'm ok with that but I got the impression they wanted to tax in-game transactions of virtual money. Maybe I read it wrong.

[Feinder]

I'm pretty sure they're talking about virtual items bought/sold with real world money.

If you slay the dragon and 1000 gold, the IRS doesn't care.
But, if you sell that 1000 gold for $100, they want their cut.

-F-

[panda124c]

Wait am minute, I smell a scam, we could start a virtual IRS for in game taxing, leans on property, confiscation of property for unpaid virtual taxes, hire a bunch of people to enforce...... the potential is enormous.


[:D][:D][:D]

[wdolson]

ORIGINAL: Kid
If they only want to tax e-items bought for real cash, I'm ok with that but I got the impression they wanted to tax in-game transactions of virtual money. Maybe I read it wrong.

They probably do want to tax people for in game transactions. If you barter with someone, the IRS wants to collect taxes on that, even though no cash changed hands because the items bartered could be traded for cash. It's screwy, and I don't think it's right, but there is a long precedent for it.

In game transactions that can be cashed in are probably going to be subject to taxation someday. Transactions that cannot be valued in US dollars won't be taxed because you aren't trading something of any value. The IRS are sharks. Instead of blood in the water, they flock around money moving around.

Personally, I think they should go after the illegal drug trade. If those drugs were made legal, brought up into a legitimate market above ground, and taxed, the US government would be awash with money. I've seen an estimate that the amount of money in the illegal drug trade with the US is more than three times the money in the entire oil market. Even if they aren't made legal, the IRS still wants a piece of it. It's just harder to collect if it's underground income.

Bill

[rtrapasso]

They probably do want to tax people for in game transactions. If you barter with someone, the IRS wants to collect taxes on that, even though no cash changed hands because the items bartered could be traded for cash. It's screwy, and I don't think it's right, but there is a long precedent for it.

This is true - they will go after you for "barter income" even though no real cash is involved (but of course, the opposite is not true in that i don't think you can subtract bad barter deals from your income...) i guess they figure this is something of a kin. Find a +5 dancing vorpal sword (that can be sold) they would count as "found income", kill a dragon for it and it is "earned income". [8|]