Should the IRS Tax Virtual Economies?

48

Comments

+ Add a Comment
avatar

hpdvs2

It won't happen.   Lets say my player account gets killed, and all my resources are stolen.  IRS equivilant 50,000$. 

I guess, since its a measurable asset, that I would, 1) contact the police, so they can begin an investigation, 2) report a theft loss of 50,000 on my tax documents.  3) wait for the refund.

avatar

girlteam2009

Het
handhaven van het hoge niveau van kwaliteit <a
href="http://www.coopersjd.com/Carol_Burnett_Complete_Series.html">carol
burnett complete</a> toont moest aanbieden, werd elk kostuum gemaakt om
de scènes te passen die worden veroorzaakt. 

avatar

girlteam2009

 Het handhaven van het hoge niveau van kwaliteit [url=http://www.coopersjd.com]carol burnett show collector's edition[/url] toont moest aanbieden, werd elk kostuum gemaakt om de scènes te passen die worden veroorzaakt. 

avatar

wowman

kidding right? It's so hard to play the game, with the quest and acquiring experience and to think I buy wow gold to level up my character, now they would be collecting tax?! Fantastic idea

avatar

dstevens

if this passes, whats next?

tax my RTS gaming revenues... i did harvest alot of gold, wood, stone, and other various resources over the last few years of gaming.... i bet the irs would love to tax that!!  

 

-- Quit game, are you sure?...

Yes....

Popup " you harvested 32000 resources, sending information to IRS, expect a statement in your email on your total taxable amount of resources within 2-3 business days "

avatar

JohnP

World of Warcraft is subject to the tax laws of Azeroth, not the United States. We "Travel" there with our fees and login passport.

   Besides, the Auction House already collects sales taxes...

avatar

AlaskaDrew

Obviously the only thing that should be taxed are any gains on in game items that are sold in the real world. Everything else is not real. It has no play in the economy aside from the sales of the program and the monthly fees, both of witch are already taxed.

avatar

Tekzel

In the real world, rich people are generally rich because they made intelligent, informed decisions.  Granted, you do have your Paris Hiltons who were born into it and are generally morons, but so be it.  Most of the rich made themselves rich, or expand upon their intereted fortunes.  I was born poor, and wasn't taught to made wise choices, my parents were as well.  I do better than they do, but I am pretty poor.  This is partially their fault for not being equipped to teach me better in my formative years, but it is primarily my own fault for not rising above the situation I was born into (as many people are able to do).  Today, I remain lower middle class, or upper lower class (around 35k - 40k a year) due to my own lack of motivation to execute a plan to do better.

So, it comes back down to this simple point.  Poor people are poor because they choose to be poor.  Rich people are generally rich because they choose to be rich.  As for rich people paying no taxes, you are on crack.  The people who carry half the tax burden in this country are the upper few percent of the citizens.  Most of the rest is carried by the middle class.  Some of us at the bottom carry the rest.  The "poor" don't pay taxes, at all.  In fact, they take taxes.  In the form of getting a tax refund that is higher than what they paid in.  And welfare programs.  The people who pay the taxes that they take are the "evil rich".  So yea, if the rich guys find a few ways to keep a little more of the stuff THEY EARNED by being smart, more power to them.  If the tax system in this country were fair, the poor would actually pay taxes instead of taking them.  Would that make you more happy?

avatar

dstevens

first... go watch zeitgeist

then you will learn that (for starters) there is not a single law that allows the irs to tax your earnings, how the Federal reserve is not controlled or connected to the US government, and how all money is actually created from thin air by the people controlling the economies of the world

based on those FACTS, or just the FIRST one, you can see how absolutely ludacris the thought of this is

 

avatar

shellpc

There is a very real economy from selling virtual goods (esp virtual currency) thats been largely untouched by taxes and I believe that is what she's referring to, not this stupid inane idea the rest of you are reading into taxing virtual economies. It would be ludicrous to tax virtual economies and would never be allowed, but its entirely logical to tax real income derived from the those virtual  economies.

 

I also find those remarks about foreigners having to be declared US citizens in order to be taxed somewhat ridiculous. You can bet when a visiting foreigner buys something here they pay sales tax, just like any other US citizen. That doesn't automatically make them a US citizen. I would also expect them to pay the same employment taxes that American citizens pay if they work here too. The same property taxes  if they choose to buy property here.

avatar

MaxFan

There is a very real economy from selling virtual goods (esp virtual currency) thats been largely untouched by taxes and I believe that is what she's referring to, not this stupid inane idea the rest of you are reading into taxing virtual economies. It would be ludicrous to tax virtual economies and would never be allowed, but its entirely logical to tax real income derived from the those virtual  economies. 

According to the quoted material in the article, which you have obviously failed to read shellpc, They refered to the Virtual Economy of the mmo not the real income, which is ALREADY taxed.  Thrice!  Uncle Sugar triple dips on taxes from corporations.  I know you knew this but you had an agenda to profess so you conveniently left that little tidbit out.

"I also find those remarks about foreigners having to be declared US citizens in order to be taxed somewhat ridiculous. "

If you bothered to read that article you would understand that they are not talking about taxing the company a 4th time they are talking about taxing  virtual citizens.  for them to do that they would elevate the MMO in question to the status of a recognized country.  Ya cant tax an economy wholesale that is not in your jurisdiction to tax.  So either you make the mistake of actually recognizing sovereignty of the mmo and declaring the characters therein to be citizens and then you attempt to tax said citizen based on something as ephemeral as an IP address or account information, or you declare that MMO to be subject to the jurisdiction of the United States and all its characters to be citizens and subject to income tax through whatever source derived as per the 16th amendment.  If you do the former you have just caused yourself a major headache in that you now have to establish an ambassador to the virtual reality provide a consulate for same, sign treaties with them ( I dont know about you but sitting across the conference table from Arthas might be a bit much for our new Secretary of State, might not have been so bad for Condi but its gonna be hell for milktoast Clinton,  shes liable to try to establish a Healthcare plan for the citizens of Icecrown!  Of course she would be right at home in the climate there) .  If you do the latter the owners of the accounts are the ones to be taxed, and thats gonna mean that you need to represent them.  they are not foreigners on US soil they are in their own country in their own homes living viscerally through the lives of their Virtual Avatars. 

Again read the article shellpc, the quotees stated "Virtual Economy".

MaxFan 

avatar

neo1piv14

"According to Taxpayer Advocate Nina Olson, the International Revenue Service should start taxing the economies of Second Life, World of Warcraft and other virtual worlds "

I wouldn't say we're reading terribly much into it. "Taxing the economies of ... virtual worlds" seems to imply that the taxes are going to be based on those virtual worlds, not the real one we inhabbit. I get the Second Life, Entropia, etc taxes, but going after your average MMO will probably just kill that segment of gaming off after people decide they don't want to have LovesToSpooge fill out a W-4 upon character creation. 

In short: Play Left4Dead, there isn't any taxable economy, so we'll all be safe. 

avatar

MaxFan

by one of our government civics dropouts in DC. 

Does anyone even remember any of the principles that were used to cause certain English subjects some 4000 miles from English Authority to seize lands and proerty "owned" by George III and start a grueling 11 year contest of wills and brought forth a new nation that we call The United States of America?  One of the reasons cited for that drastic change was taxation without representation.  Now if DC Beltway types DID implement this (and trust me there is no way they could without it being considered legally capricious) cockamaimy idea, we would have to provide representation to those citizens of the virtual worlds of WOW SL Entopia et al. 

Im not real sure if I want Kim Il Jong or Osama Bin Laden or a potential Pol Pot to be able to acquire voting rights in my country simply by purchasing a game and clicking a button to gain automatic United States Citizenship.  But in order to do the job as the Declaration and the Constitution intended you would give ANYONE who became a citizen of one of these virtual worlds automatic citizenship here as the constitution clearly defines citizenship as a requirement to being taxed the government of the United States.

   "The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises, to pay the Debts and provide for the common Defence and general Welfare of the United States; but all Duties, Imposts and Excises shall be uniform throughout the United States;"

   and

   "No capitation, or other direct, Tax shall be laid, unless in Proportion to the Census or Enumeration herein before directed to be taken"

and

The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.

 

If you take these sections and apply them to virtual worlds like WOW or SL or Entopia you must do what the last of the quoted sections from the constitution state.  Provide them with citizenship as they are being TAXED like citizens.  Are we going to Tax Russian Citizens? England? China?  I rather think that the leaders of those nations might have some disagreement with Ms. Olson and Dan Miller.  Nuclear weapons make for real strong advocacy of respecting borders in matters of taxation and citizenship. 

Might be similar to what happens in the old text base game Balance of Power when you reached Defcon 2 and decided not to take your advisors advice and chose to be pigheaded:  Message Screen from Soviet Premier:  "Our counter offer is written on the side of the complimentary ICBM now winging its way to you!"  Next Screen:  Black screen white text "you have initiated a global thermonuclear war and no there will not be any grandiose pictures of mushroom clouds.  YOU LOSE!"  "We do not reward failure"  GAME OVER

 

 

 

avatar

ubuwalker31

If you are curious about the rules that the IRS uses to tax nonresident aliens (that means foreign citizens), check out http://www.irs.gov/publications/p519/index.html.  Of course, a nonresident alien usually is subject to U.S. income tax only on U.S. source income. Under limited circumstances, certain
foreign source income is
subject to U.S. tax as well.

Your "taxation without representation" argument holds no water for foreign citizens.  Just because citizens have a right to "no taxation without representation", doesn't mean that non-citizens have that right, especially since foreigners don't have a right to representation in the US Congress. 

If you could avoid US income tax by not being a US citizen, every person making significant amounts of money here would become a citizen of Swaziland.  Logic dictates that this is not a desired outcome and that foreign corporations and foreign citizens should be subject to US taxation. 

However, the US has recognized that our tax system isn't viewed as fair by other countries, and we do have numerous tax treaties with other nations.  Check out http://www.us.kpmg.com/microsite/ies/tfc/content/chapter6.htm and http://www.us.kpmg.com/microsite/ies/tfc/content/appc.htm for some interesting treaty rules.

So the real question is whether a bunch of Chinese gold farmers working in China, using servers in the US, is enough of a contact with the US to be subject to US taxation.  Is it a US source of income?  I don't think it is...but I'd consult an international tax law specialist first if I wanted to stay on the good side of the law.

avatar

MaxFan

@ubuwalker31,

do not make the mistake of trying to quote IRS law.  You cannot possibly know IRS law well enough to determine how and when a foreign national can be taxed.  Even if you wrote portions of the IRS Code you wouldnt know the law well enough.  We are refering to the IRS Code here my friend a code that currently extends to over 90,000 pages (sans definitions, and appendices. If you add those in it gets comfortably over the 200K page mark) No one know the IRS Code well enough to make definitive determenations like that.  portions of the original IRS Code are still being debated in courts and the senators and congresmen and women who work on tax legislation do not know it in full well enough to make that determination.

But for the sake of argument lets say that the publication in the link applies, and that you are correct that nonresident aliens are only subject to income tax on US Source income.  The Virtual Economy of an MMO is based on gold or platinum or electrum or whatever.  Not real gold, which actually has an intrinsic value, but virtual gold which, as far as I know, only has the value of the electrons traveling in the datastream between server and client.  This gold has no set standard rate of exchange x amount of gold buys you x amount of a consumable product, and to try to model this for the purpose of computing taxes would be an accountants worst nightmare.  so lets tax this unweildy beast.  How do we collect?  send out collection notices to account holders?  well we need to get accurate information about all of those accounts first so lets seize the account servers for the MMO, and now lets tally up the existing accounts.  (15million and counting in the case of World Of Warcraft) and now we will have to get the developers to add a w-2 or 1099 form to the account creation page.  Oh and by the way, WHICH character as most mmo's allow the creation of multiple characters, is responsible for the tax and actually has to fill out the w-2 or 1099.  Now do we include the characters in the standard graduated income tax that we now have or do we create a different scale for them.  Are characters in WoW subject to FICA and SSA deductions?  If so they are also entitled to everything else and thereofre have just become citizens.  Where does it end?          

avatar

ubuwalker31

"You cannot possibly know IRS law well enough to determine how and when a foreign national can be taxed."

It is clear beyond any doubt that foreign nationals who work or do business in the USA are subject to Federal Income tax.  You don't have to be an expert in tax law to know this.  There are international treaties that dictate these taxes.  Actual determination of how much tax should be left to accountants.  Bizarre cases like the Chinese gold farmers using Blizzard servers in the USA, are the types of things you consult an international tax lawyer about or write the IRS for an official letter opinion.

"We are refering <sic> to the IRS Code [that]
extends to over 90,000 pages....No one know
the IRS Code well enough to make definitive determenations <sic> like that."

Bullshit.  The number of pages of laws and regulations governing the taxation of foreign businesses and individuals is quantifiable and knowable.  In fact, I know that my accountant has a 500pg looseleaf book on international taxation thats on his bookshelf.  Tax law might be confusing, but for the most part, it is pretty straight forward, once you have deciphered the hieroglyphics. 

It might be a mystery to you, but it isn't a mystery to people who are familiar with the Code.

I agree with you that the taxation of a Virtual Economy is problematic.  I believe that the biggest problem is that only gains that are *realized* can be taxed.  It is widely understood that profits made running a business that deals in virtual goods or services are taxable.  The two main problems are enforcement and the undecided question of when these virtual profits are taxable. 

It is clear that once you take the money out of the game, and make a profit, it is taxable.  No question on this by any experts in the field.  The real open question is whether in-game transactions are taxable.  This is when we enter the realm of theory.  Some experts say absolutely not, others say that if the transactions are part of game play, they should be excluded, but that if the transactions are not part of game play...that is, that they aren't fun and that the person is *working*, they should be taxed.

Your point about enforcement is very well thought out....getting info on 15 million players is an administrative nightmare.  Your slippery slope argument about taxing multiple characters who owe FICA and whether they are citizens is silly, and misses the point:  real people are making money tax free, and that is not fair to the people who pay all of their taxes.

avatar

r3dd4wg

I know the U.S. government is hurting after bailing out Wall Street and the auto mfrs but this thing of taxing virtual money sounds a little desperate.  The last time I checked, money in a game is "play" money.  It's not real.  Things not real can't be taxed.  What's next?  Going after everyone who has ever played the game Monopoly for income and real estate taxes???  How about all those people who play stock market simulators?  Online poker (with play chips)???

avatar

rogervin

As already stated...The gaming usage agreement indicates that users are not to conduct "real" financial activities within or in support of the game. I know that there are those who try to gain financially by breaking and/or ignoring the rules, however it is still wrong. The government can't even enforce many of the laws on the books today, so let's not  add more rediculous rules and regulations.

The virtual cash that is earned and spent in games like WOW being taxed? Well maybe a virtual tax would be ok. Then the game could add a virtual tax organization, a virtual tax season, and even virtual agents that engage in PvP to collect taxes from delinquent toons. The tax folks would probably have to be "blood elves" though and those others that of the same class in the game might get upset.

 Seriously! Don't we have bigger problems to solve?

avatar

shellpc

That doesn't stop quite a few companies from making huge profits off goldselling. You could   say  they're breaking a  contract by violating the eula, but afaik there is no legal precedent that states selling virtual goods for real money is   illegal.

 You're also forgetting that there are games that do allow you to make a real profit without violating the EULA - Second Life, Entropia, and the SOE Exchange.

avatar

X

As soon as WoW gold is recognized as the national currency I’ll start paying taxes on it.  Also, am I going to be arrested for tax evasion if I don’t report my monopoly winnings?

avatar

gumbo87

Why is everyone so upset.  Your imaginary WoW income should be taxed for real money.  How else are we going to spread the wealth around?  If you can afford a $15/month subscription, you can afford to spread some of that around to the less fortunate.  I want my socialized healthcare and in order for that to happen, someone else has to pay.  Oh yeah.  I guess everyone voted for change and not anything remotely resembling substance.

And I'm hardly suggesting that there's a direct causality between his election and this crazy bitch's recommendation.

Oh, and to suggest that rich people don't pay taxes by jumping through some hidden loophole is one of the single most ignorant things I've ever heard.  Maybe rich people keep getting richer, because they keep doing the same thing that got them rich in the first place.  Amazing concept!  Gotta love the retards working retail at the mall who can't figure out why theyre riding around in a Fast and the Furious car and the wealthy cruise around in cars they only drive in their wettest of dreams.  It has to be a conspiracy! 

avatar

neo1piv14

Now that I think about it, I'd actually like it if they made a formal taxation system for online games. Think about it, you could write off your entire gaming machine as a business expense. Every game you purchased would be a tax write off because it's a business purchase. The government stands to lose much much more than it stands to gain, since most people that play all these games never see a single penny come back to them. For every person out there that farms gold and sells characters, there's thousands more that just play the game by the rules.

avatar

lvglen

When I saw on the first line of the article, "International Revenue Service," I thought this was some kind of a joke.  A very bad joke.  But the link goes to the "Internal Revenue Service" website, so I guess this is for real.  Mr. Spilsbury, you are hereby required to go back to your high school government class and retake the section about the US government and its taxation arm.

avatar

shellpc

I don't know if money gained while violating the eula is actually taxable or not, but both Second Life and Entropia both allow you to exchange real money for virtual and back so there is a potential source of income that's also  not in  violation of  the EULAs from those games. SOE also has the Exchange for EQ2 that allows you to sell your chars and even items for real money(under SOE's supervision).

Oh and microtransactions are here to stay. Both Blizzard and SOE do it with their TCGs and special cards that reward ingame benefits. SOE has also added a marketplace for buying ingame buffs and novelty items for chracters in EQ. Guild Wars is full of MTs. The new KOTOR mmo is going to have MTs as well. COH also sold a small addon pack sometime last year that helped pay for getting some major content added in a few  issues(content updates) sooner than expected. 

avatar

Spider-Mom

You cant tax a unsanctioned transaction. Selling in game items in games like WoW for real money is strickly against the EULA. I dont know about SL, but tring to tax gold farmers is like trying to tax illegal drug trade. Nice try any way.

 

Ied also like to say that I am fermly against games that force you to buy in game items from the publisher and these "micro transactions." Its an idiotic idea that kills real game play and as far as im concerned i hope they tax that crap into oblivion so that real games can thrive. Also MaximumPC is stupid for claiming that theses MT are the future.Go screw your self please, there are comsumes who actualy want a quality product. Ied much rather in game mechanics be designed for fun rather than making people want to spend extra money. Screw that.

avatar

ubuwalker31

LOL, please cite the section of the IRS tax code that says that "unsanctioned transactions"are not taxable. You can't, because there are none.

Using your logic (or rather lack thereof) all I have to do to avoid taxes is to run an unauthorized business in violation of an agreement between two private parties.  Gee, thats easy!  I'll sell candy from a newsstand with the "not for individual sale" lable individually, make a profit, and not have to pay taxes!  Wow, why didn't I think of this before?  What Hogwash.  You still owe taxes.

In fact, the US government can and does tax people on any form of income,
including income earned in violation of a contract or in violation of
criminal law.  One way the government goes after criminals is by prosecuting criminals for
failure to file a tax return for their ill gotten gains.

Check out United States v. Sullivan, 274 U.S. 259 (1927), which is a
Supreme Court case that holds that  financial gains made from illegal
activities, such as drug sales or gambling are taxable income.  http://laws.findlaw.com/us/274/259.html

avatar

Spider-Mom

You obviously know nothing about the issue at
hand. The reason the IRS(and you) are so stupid is because all of
these transactions take place /ANON. Theres no way in hell they
would even know the transactions are taking place. There is no way to track this and hold any one accountable. Half the time the game
companies dont even know when the players are doing this. That is BECAUSE it is hidden due to the fact its against the EULA and would get the players banned. Sorry ubuwanker, this has nothing to do with IRS law. If you actually knew anything about this topic you would be able to see that pretty clearly.

If I were a plat farmer, I would say BRING IT ON! There would be no way the IRS would ever have a clue what I was doing and they would never be able to enforce it. If this kind of idiot law could be enforced, IT WOULD NOT BE HAPENEING! That much is obvious to all but the likes of the IRS who have no clue what their talking about and the internet lawyer Ubunuub.

 

Furthermore, for the IRS to say that in-game curnacy holds any real world monitary value, they would infact be breaking several laws. Anyone who openly trades that stuff for money could be sued into the stone age(as has happened) by the publisher. It has been heled in court that selling in game coin for real money holds you liable to company losses. 

If this idiot law were to progess to any and all in game transactions under the assumtion it is actualy monetary income, there wouldnt be much to keep track of any way. Do you know why? Its because the majority of these types of games would DIE overnight. 

Tax MY plat, and nigga I /cancle that  same second.

 

 

And btw. ITS FUCKING MAKE BELIEVE! ITS NOT FREAKING REAL. GET A FREAKING LIFE IF YOU THINK YOU CAN TAX VIRTUAL GOODS WHOS MONETARY VALUE HAS ONLY BEEN ESTABLISHED BY A FEW LAW BREAKING FREAKS. I WOULD NEVER PAY REAL MONEY FOR ANY OF THAT AND FOR THE IRS TO ASSUME I WOULD.... Well, they would prolly rather just wish I and the hoards of rioting people across the country were fake also :)

 

If these idiots HONESTLY think they can tax people for something that holds no monetary value, then I can see why some people think we should pull a Circut City on the IRS and be done with the problem.  But now were getting a new head for the IRS who doesnt even know how to pay his own taxes so Im sure the idiots in Washington would never be able to pull this off.

avatar

shellpc

Isn't that what the Treasury Dept    did to Capone? Charge him with tax evasion on all that   illegally  earned income he didn't declare?

avatar

Spider-Mom

no

avatar

Founck

Would you have to pay a luxury tax on the Sword of a Thousand Truths?

avatar

ubuwalker31

...but on actual real world income.  Gross income is any income, from whatever source derived.  However, in order for gross income to be taxed, it must be "realized".  So, when your 100 shares of stock goes up $10 a share, you aren't taxed immediately on the $1000 of gain because there has not been any realization event.  However, you are taxed when you sell your stock.

Take this principle and apply it to MMOs.  If you use in-game money to make more fake money in game to acquire in-game benefits, you haven't really benefited in real life.  You haven't made any money, you have just advanced in the game.  Now, if you sell an item in game for more than its was worth when you bought it, you have made some money in-game that you can use to buy more things in-game...thats how you 'win' at any game...you collect fake monopoly money to win the game.  Sure, you have an intangible real world benefit, since you have a powerful item, but you haven't realized any monetary gain.  The gain is completely imaginary.

Now here is the rub...if you sell your fake monopoly money or that powerful item that you won in your fake game FOR REAL CASH...you have a taxable event.  So, if you buy a game for $50, play really hard to get an amazing in-game item, and sell that item for $300, you just made $250 IN REAL LIFE.  

If I work really hard on my computer at work and make $250, why should I not be taxed on that?  Why does it matter if I am working on an excel spreadsheet or playing a game?  Why should someone who makes $30,000 a year plaing WoW be exempt from paying taxs on his income?

avatar

neo1piv14

There's a very simple reason why that income shouldn't be taxed...it's against the rules of the game. If the IRS can track you down to tax you, I'm sure Blizzard can track you down to ban you. The government benefiting from tax money garnered from "illegal" gold farming would be like them benefiting from income gained via mugging.

avatar

ubuwalker31

Of course the government taxes illegal income.

The government can and does tax people on any form of income, including income earned in violation of a contract or in violation of criminal law.  In fact, the government has prosecuted criminals for failure to file a tax return for their ill gotten gains.

Check out United States v. Sullivan, 274 U.S. 259 (1927), which is a Supreme Court case that holds that  financial gains made from illegal activities, such as drug sales or
gambling are taxable income.  http://laws.findlaw.com/us/274/259.html

avatar

shellpc

Believe it or not,  but there are people who make real  money from playing these kinds of games and not all goldsellers are Chinese either. These are the people she'smost likely talking about.

 Some years ago, when I still played eq, there was a guy on my server who was notorious for boxing a full group and farming drops for real money. I had even visited his website once. He was American and had a regular job and was doing this to earn extra money on the side.

 IGE, one of the top gold selling companies, was at one time based in the United States.

Games like Second Life and Entropia allow you to exchange real money for virtual money and back. I can even recall a guildie in EQ mentioning actually collecting rent on property in Second Life. It wasn't much, but was a bit extra real cash for them.

Normally, you get taxed on most any source of income, except the ones mentioned above. Nobody likes taxes, but thats how the  system works. They feel they're not getting their fair share of taxes and they will eventually start taxing such sources, its inevitable.

I don't see much of a problem with it. (other than who likes to pay taxes?) Just so long as they don't bug me when I'm  not making any money off Wow.

avatar

Kasekopf

 

Right after businesses start paying tax on Intellectual "Property".

avatar

DerfMcWoowoo

Yes! What will our greedy government try to get from us next? Great comment Kasekopf!

avatar

xunknownx

thats the most retarded thing i ever heard. it gave me a good laugh. is that even possible? taxing us for playing a game? which the currency isnt even real....

avatar

anonuser

The specific reference from this article is in this publication:  Volume I,Section One - Preface, Table of Contents, and The Most Serious Problems Encountered By Taxpayers http://www.irs.gov/pub/irs-utl/08_tas_arc_intro_toc_msp.pdf - starting on page
213. 

There is a very important point that the author of this article seems to be ridiculously out of touch with and it is this: Virtual currency has no intrinsic value.  It’s not the same as a lump of gold or drop of oil or gallon of water. The value of a virtual item or virtual currency is directly and only related to the demand for it.  If blizzard decided tomorrow that everything in the game is now available from any vendor for free, then the perceived value of WoW Gold would be less than dog feces.

It may be that there is a fine line between certain virtual worlds.  Second Life, for instance, is designed to have interactions with real world money.

avatar

jcollins

So, if they can tax you on earnings, does that mean you can get a tax cut on losses?  :)

avatar

BAMT

It's called a game for a reason. Anyone here want to play Monopoly? Get out your tax papers!

avatar

neo1piv14

This would be fantastic. If you're going to tax people in an online world, then you have to tax them by the rules of that world. I'd love to see someone with an IRS tag come try to take my L2 Adena from me in game. Online game worlds should be treated the same way as an All-You-Can-Eat Buffet. Gold made in WoW isn't income earned. It's a trade in resources. You give Blizzard 15 bucks a month and in exchange, you're given the opportunity to go do whatever you want in that game world. The only thing they might be able to make a case for taxing are games like Second Life and Entropia Universe. Even then, as long as the tax collecting is done in-game, I'll laugh my butt off all the way to virtual jail for vaporizing a tax collector. 

avatar

habuza

What fantasy land are you living in? Rich pay taxes? They have an insane amount of tax breaks, so do big corporations. If they get taxed so much you ever notice how the rich just keep getting richer and the not so rich seem to have trouble making ends meet?

 But I digress, taxing a video game would be ludicrous. Uncle Sam can tongue my butthole if they think I'm going to pay tax to play a video game. ( Yes I play WoW, who doesn't. ) , but I think the point of this article was getting taxing the various people / groups that make$$ playing this game. ( Gold farmers / item selling / power leveling services etc etc ) Not the people that actually play the game and abide by the terms set forth in the EULA , which is how I understood the article.

 @Xerloq

LOL! I love that idea. Tax collector would be dead in a heartbeat. Hehe.

avatar

DerfMcWoowoo

Your ignorance of the US tax system is, unfortunately, too common. Don't listen to the BS that the media and other ignorant, poor, and jealous, people feed you. It's bad for your health. Taxes won't make you rich or poor, decisions do that. Stupid decisions make you poor, wise decisions make you rich. It's a myth that rich people don't pay taxes or have "secret" tax breaks. Sorry, but, that couldn't be more false.

The existing tax system is already setup to deal with people who make money of off WOW. Nothing more needs to be done except to enforce the existing laws. If people make $50k off of online services, they need to report that on their tax return. Question is, will people actually do the right thing (refer to previous comment about making wise decisions)?

9 out of 10 millionaires are first-generation rich (that means they did it themselves and in their own lifetime).

avatar

Xerloq

I think this is a great idea - so long as it is funded by and collects only the in-game currencies and items of the economy they want to tax.

I'd love being able to pay my tax bill with Isk.

Additionally, all the infrastructure needed to collect and run these tax programs need to be run in world. So if a tax collector comes up to you in an MMORPG, you can legally kill him in a PVP area, and loot  him to boot!

 

avatar

farlo

come on this is hilarious, this has no way of ever going through.

i can understand taxing the hell out of gold farmer sites, however it would be baseless for taxing an online economy such as WoW as the loot and gold you receive are valuless according to the games TOS.

avatar

DerfMcWoowoo

This is so WRONG on so many levels!

Here's one issue I have. Some people play WOW religously. It's probably become it's own religion somehow. Because of that, the government should stay out!

Okay, so my example is dumb, but so is the idea of taxing virtual economies. Would anybody like our government to start enforcing current laws, lowering taxes, cutting stupid government programs, and giving us some of our money back, instead of wasting time trying to get more $$ from taxpayers?

How about equal taxation? The poor don't pay there "fair" share. The rich pay way too much!

Dumb, dumb, dumb!

avatar

Maggard

Having played MMORPGs for the last twelve years I realize I have put more money into them than I have ever gotten out of them.  Infact I'm wondering where the IRS (which isn't even, technically, the US Government) get's off with the idea considering the games are expenditures to those who follow the EULA.

 

I think they need to chase down the "Chinese" Gold Farmers and tax those guys.

 

If you have nothing nice to say...say it on the Internet.

avatar

DerfMcWoowoo

I thought I was going to be the first post, but you beat my ass!

Great point. People poor money into virtual economies, but they don't get anything out.

Log in to MaximumPC directly or log in using Facebook

Forgot your username or password?
Click here for help.

Login with Facebook
Log in using Facebook to share comments and articles easily with your Facebook feed.