Quote:
Originally Posted by aridash
As GBE points out, this is really simple, they tax you when you withdraw. The same as how they tax you when you by shares or as someone said, stamps or any thing else. You dont get taxed on the increased value of the share or stam while you still own it, you only have a tax liability upon sale. Tax man is interested that its not used for fraud or avoidance more than anything else.
There has been no progress on taxation of internet trades dispite 15 years or so of looking at it and many legislators are very hostile towards it. so why are they going to be any different to MMO/virtual worlds? It needs too much cooperation between all nations and they cant even agree on legislation such as Intellectual Property.
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I think that it is true. In this case, you have truly not won anything until you withdraw. I am finishing my last class for a degree in accounting and I have thought hard about how to classify the money that I have ingame. This is how I see it. The money spent in game is essentially gambling loss or the same as money invested in stocks. It is irrelevant to IRS until it is either sold or interest is paid to the individual. So unless one withdraws, there is no income. Much of what we earn in game is not money that is realizable except in the game. Markup is not guarrenteed money.