Will the IRS take a bite out of Bitcoin?

BGR.com
Bitcoin Taxes

Bitcoin Taxes

Bitcoin is a good way for people to conduct business off the grid, but the free ride may soon come to an end. Everyone’s favorite virtual currency has been on quite a wild ride over the past few weeks. The mainstream media finally caught wind of Bitcoin and curious parties sent it skyrocketing to $220 before watching it plummet below $70 a few short days later. It has been quite a roller coaster, but all this attention may have caught the IRS’s eye, too — Forbes contributor Robert Wood noted in a recent column that the Treasury’s FinCEN already has rules pertaining to Bitcoin, and soon the IRS might as well.

[More from BGR: Samsung Galaxy S4: Jack of all trades, still master of just one]

“Income is income, whether you get it in cash or in kind,” Wood wrote. “Bitcoin may be accepted as currency and may not be easy to trace but so are trades and barters. When you barter or swap one item for another, both parties have tax consequences.” The IRS requires that taxpayers report any and all income, of course, and there’s a good chance the agency will soon grow tired of seeing some people use Bitcoin to game the system.

[More from BGR: This is the back of a $640 phone]

“The FinCEN rules say Bitcoin exchanges and Bitcoin miners should register as Money Services Businesses (MSBs) and comply with anti-money laundering regulations,” Wood noted. “Ordinary Bitcoin users don’t have to register just to purchase goods and services. But will Forms 1099 and other nettlesome signs of civilization soon bite Bitcoin? Yes, and probably soon.”


This article was originally published on BGR.com

View Comments (12)

Recommended for You

  • Police officer shot after responding to wrong home

    ATLANTA (AP) — A police officer was shot and critically wounded Monday when he responded to a call of a suspicious person and showed up at the wrong house, authorities said.

    Associated Press
  • Man sentenced to life with no parole walks free in Missouri

    JEFFERSON CITY, Mo. (AP) — A man sentenced to life in prison without parole on a marijuana-related charge walked out of a Missouri prison a free man on Tuesday, after spending two decades behind bars.

    Associated Press
  • Woman Becoming Nun Needs Friend's Interest, Not Concern

    DEAR ABBY: I was best friends with "Joanne" after we met in middle school. She comes from a conservative Christian family and has three successful siblings. This has made her quirky, media-driven pursuits and city life a disappointment to her family. When we were teens and she learned that I was a…

    Dear Abby
  • Real say De Gea transfer not their fault

    Real Madrid said on Tuesday they had done everything needed to complete the signing of goalkeeper David De Gea from Manchester United before Monday's midnight deadline and hinted that the English club were to blame for the deal's failure. Spain goalkeeper De Gea was all set to join Real but is now…

    Reuters55 mins ago
  • Video of Israeli soldier arresting boy becomes latest in war of perception

    A soldier pins a boy down and is assaulted by his family: The scene might have gone unnoticed if not for footage that has turned it into another weapon in the Israel-Palestinian war of perception. Palestinians see it as proof of Israel's abuses in the occupied West Bank, while many Israelis say the…

    AFP
  • Sheriff: Suspect kills mother, stepfather, grandmother

    Outfitted in camouflage and armed with a high-powered rifle and 100 rounds of ammunition, Robert Seth Denton fatally shot his mother, stepfather and grandmother while six children witnessed the carnage in the family's double-wide mobile home in eastern Tennessee, a sheriff said Monday.

    Associated Press
  • Play

    Woman was getting high on canned air at Kansas Walmart, police say

    Melissa Ann Wright is accused of huffing an industrial strength duster chemical while shopping at a Kansas area Walmart.

    KTRK – Houston
  • Obama slams 'completely unacceptable' cop killing

    President Barack Obama vowed Monday to push for police officer safety after a Texas sheriff's deputy was gunned down from behind and shot multiple times at close range. Darren Goforth, 47, was killed late Friday in the Houston area, and local officials have blamed ramped-up rhetoric against police…

    AFP
  • Investigators: Arizona woman acknowledges drowning twin sons

    PHOENIX (AP) — An Arizona woman told investigators that she drowned her 2-year-old twin sons and tried to kill her 3-year-old stepbrother in the same way because she didn't want them to live with the difficulties she faces.

    Associated Press
  • Daughter Deep In Debt Needs Counseling, Not More Money

    DEAR ABBY: Three years ago I gave my adult daughter, married with a child, more than $16,000 to help pay off her debts because she couldn't pay her bills. She and her husband maintain separate accounts, which I find odd. He pays certain expenses; she pays others. Now I find she's deep in debt again…

    Dear Abby
  • This versatile 15-in-1 Travel Jacket is Kickstarter’s most funded piece of clothing at $7.2M

    Remember the MacGyver Travel Jacket that has 15 compartments that each have their own designated functions? It turns out that so many people loved the idea of having such a “smart” jacket that the project became the most funded piece of clothing in Kickstarter history, topping $7.2 million in…

    BGR News
  • Migrants protest as Hungary shutters Budapest train station

    By Krisztina Than BUDAPEST (Reuters) - Hundreds of angry migrants demonstrated outside Budapest's shuttered Eastern Railway Terminus on Tuesday, demanding that they be allowed to travel on to Germany, as a migration crisis put the European Union's rules under unprecedented strain. Hungarian…

    Reuters
  • With help, small island states ditch diesel for cheaper, cleaner energy

    By Megan Rowling BARCELONA (Thomson Reuters Foundation) - After oil prices hit a record high in July 2008, the tiny Pacific nation of the Marshall Islands was forced to declare an economic emergency since around 90 percent of its energy needs were met by imported petroleum products. The fuel price…

    Reuters
  • View

    Kentucky county clerk refuses to issue same-sex marriage licenses (26 photos)

    Gay couples in a Kentucky county are expected at the courthouse door Tuesday morning after the Supreme Court ruled against a defiant clerk who has refused to hand out marriage licenses to same-sex couples. The Supreme Court ruled against the county clerk who refused to issue gay marriage licenses,…

    Yahoo News
  • All eyes on Manchester United as deadline day dawns

    Manchester United were the centre of attention as the Premier League's transfer deadline day dawned on Tuesday, with moves involving David de Gea and Anthony Martial awaiting completion. Goalkeeper De Gea had appeared on the brink of a move to Real Madrid worth between 30 million ($33.8 million)…

    AFP
  • CERN: Test results show more detail about 'God particle'

    GENEVA (AP) — After three years of scrutinizing the elusive Higgs boson closely, scientists say they've determined that the "God particle" behaves just as predicted.

    Associated Press
  • Japan arrests 'Flipper' trainer as dolphin hunt starts

    Japanese police said Tuesday they had arrested US animal rights activist Ric O'Barry, who trained dolphins for the TV show "Flipper", near the town of Taiji as it kicked off its controversial dolphin hunt. "We had a report that he was drinking alcohol and driving, so officers were dispatched to…

    AFP
  • Indian scholar who criticized idol worship murdered at home

    NEW DELHI (AP) — Following a knock at his front door, an Indian scholar greeted two unidentified visitors and was shot in the head and the chest, becoming the third critic of religious superstition to be killed in the country in three years.

    Associated Press