03/25/2014 // West Palm Beach, Florida, US // JusticeNewsFlash // Justice News Flash // (press release)
Washington – The Internal Revenue Service stated on Tuesday that bitcoin, a virtual currency, will be taxed like property as opposed to currency. As reported by the Associated Press (AP), although it is not legal tender and cannot be used as payment of taxes, the IRS says it is taxable.
A series of questions and answers regarding bitcoin was issued by the IRS to provide information on how virtual currencies are treated for tax purposes. In accordance with the information, wages paid in bitcoin would be taxed at the fair market value at the time the wages were paid. With regard to investments, bitcoins would receive the same treatment as commodities, with capital gains to be paid when they are sold and capital losses recognized if they lose value.
Bitcoin was created in 2009 and allows people to make transactions for buying, selling, and exchanging money without the use of third parties like banks.
This report is provided by Justice News Flash – Washington Legal News
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