Nice Work Retrieving That Magic Sword... But Now You Need To Pay Uncle Sam For It
from the oh-please dept
We've discussed, at length, the many, many reasons why it's a bad idea to start taking in-game crimes and putting them in real world courts -- even if people are getting scammed out of things that have real value. Because the game allowed it, it's an in-game issue and should be taken care of within the game. Otherwise where is the line? Some games allow for stealing and crime -- or even encourage it. If that's the case, then what happens when a player in one of those games takes a dispute out to court? It seems silly since the point of the game is to set up a world where those actions are acceptable. In almost every case, there should be some sort of way that the issue can be handled within the game. However, as people continue to take such disputes outside of the game, while talking up how much value there is within the game, it has apparently attracted some interest of politicians who are wondering if it makes sense to tax in-game proceeds. By taking any aspect of the game and connecting it directly to the real world, the games have only brought this possibility on themselves. Note that the politicians aren't talking about virtual items in the game that have been converted to real dollars or other assets. That's already taxable as income. Instead, they're looking at actually taxing the items within the game based on the perceived value of those assets. This opens up a huge set of issues that aren't likely to go away very easily -- while also making it a lot more expensive to spend much time playing online games.
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Question
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Does this mean...
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He had better be invincible...
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Re:
who is responsible if my account is hacked? will the police in my county investigate or am i out of luck and im liable to pay taxes on the gold i earn, but nobody is liable to investigate the theft of that same gold?
will the same system that taxes me, also give me interest on money in the bank?
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Re:
SE implimented many countermeasures which has limited how IGE's Gil Farmers ability to make money. They have been limited to flooding he Auction Houses with items and driving down prices to make them sell faster. IGE is also branching off into Power Leveling for money. Twice in last three months SE has banned over2,000 users accounts for using 3rd party chatting tools.
I think it is wrong to tax in-game money. Getting in-game money for WoW and FFXI is against the EULA, but it would work wiith something like Second Life where its virtual money can be bought with real money and can be exchanged for real money.
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Game Taxe
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Re: Game Taxe
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Re: Game Taxe
I agree with you 100%!!!
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Re: Game Taxe
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Ok
I have to admit, If they do start taxing in-games, it will be the fastest and most effective way to get people to stop playing. why do I start to think that Florida lawyer is behind this?
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Not gonna happen
Politicians don't understand this crap... and besides, all this stuff will clog up the Internet tubes!
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Re: Not gonna happen
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Monopoly?
And if any of us are caught with the odd $500 bill up our sleeves, we can be sued?
I think we should invent the concept of a game-game. This is just like a normal game, except that it explicitly requires all participants to waive any legal rights they have to prosecute each other for cheating, and also asserts that all in-game-game transactions are purely for amusement and despite resemblance bear no meaningful relationship to actual financial instruments.
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The Money Game!
work for real life government money.
Oh, I fogot... that's what politicians do if
you can call it work.
Whatever politicians came up with this idea
should win a prize for exhibiting the unbridled
greed of our public servants.
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Selective game play...
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w00t!!
if it makes PKing illegal i am all for it. 90% of nerfs are intended to help those wankers out, so i say "bring on the IRS"!!!
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Big can of worms...
Tax Breaks
Virtual Tax Evasion
Cross that that stuff over with virtual issues (like server crashes and servers with small populations) and you are looking at a big mess of problems. Frankly the goverment needs to get the tax system straight in the real world first before trying stick their hands in someone else's Kool Aid.
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FDIC insurance?
How will they justify taxing some Korean basement dweller vs an American one?
If I'm a WoW enchanter, can I write off the cost of the epic that I disenchant if I don't get the desired outcome?
If I'm a gold farmer, can I write off equipment and repairs as a business expense?
Will they need to create a new profession of "Accountant". I want to be a guild accountant so I can raid on the same team as Bob from Acounttemps.
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Re: FDIC insurance?
What a load this all is, though. For example, if you play EQ2 on a server that is not an exchange server there is no (legal) way to make real life money, so why the hell would it be taxable. And, what would the value be for some fabled gear? Would I be taxed on the gear's real world equivalent in plat sales? So if 10 plat is going for $20 and the item is sells in game for around 10 plat am i taxed on $20 of revenue? Revenue never realized, mind you, cause I use the item?
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Jurisdiction?
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Re:
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OK
So I just picked up a hot new sword in an online game, and now you want to tax me even though I haven't converted that "virtual asset" to real life money? OK maybe that's alright if you'll allow me to pay in virtual money. I mean, if that sword has real life value then so does the virtual money I would be paying the IRS with, right?
Oh wait, I forgot. I play on a server that is based in Korea. So how are you going to verify that I actually own what you think that I own? More to the point, do you even have jurisdiction? Sure I'm sitting in the US when I play, but the activity that creates the items that have value take place (if indeed they can be said to take place in any physical place at all) in a server outside the country.
Or how about the reverse? What about Korean players playing on an American server?
Oh yeah, how do you actually link the account to the person who owns it to even determine what country they are in to begin with? If they play with a credit card, I could maybe see it. But what if they buy gametime codes via some other method?
Or here's a good one. They want to charge you income tax on virtual income created in game. But what happens when a 14-year old plays 50 hours a week and then has to pay taxes on his in-game earnings? Is he playing, or is he working? Is he violating child labor laws?
What happens if you fail to pay taxes on your virtual goods that are never monetized in the real world? Do they put a lien on your virtual house? Do they take it away from you and then try to sell it? How do you determine whether the virtual goods were acquired before or after the start of some effective date for taxes? How does the government propose actually collecting and enforcing these taxes? Are they going to set up different systems to monitor each individual server of each online game? If so, they're going to end up spending far more in enforcement than they would reap in collections.
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The idea of a virtual world is that it's VIRTUAL -- you don't have the same worries as real life. Besides, if I go out and kill people and take their money in real life, I'm sure as hell not going to report it as income, why would I do so in a game?
I don't even know how I'm taking this seriously, to be honest. The idea is that ludicrous. This article would be a great prank/fake article or satire.
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Thanks Mike
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I hate to say it...
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zomg
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Capital Gains Tax
This is how stocks work, although I'm not sure what happens if you barter stocks for other securities.
Although, no offense, if you invest that much time to playing games that you make a living off it; that's punishment enough.
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Our politicians are on crack
the only way virtual money can convert into real money is from suckers who buy virtual money/goods through players who sell it for real money (which is* currently taxable). of course, this can be circumvented by simply ammending or inventing a new law.
so what happens if you claim your virtual money on your taxes and you end up oweing the IRS for it? can you pay the IRS in vitual funds, or will you have to use your hard earned real money (considering you didn't get it from selling virtual money) to pay off the IRS for the virtual funds you received?
I have a theory that 3/5 of our government is secretly addicted to MMORPGs. WoW.
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Taxable game assets
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two cents worth
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Problem solved.
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Re:
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#4
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two cents worth
So let them pay the taxes...after all it belongs to them...I'm just borrowing it.
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??
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deja vu
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First step: show us the law that authorizes a non-apportioned tax on labor.
Second step: Document that the 16th Amendment, on which such a non-apportioned direct tax is based, was actually ratified by the necessary number of states.
In other words, why are YOU paying taxes to the IRS in the first place? (Virtual or otherwise).
If anything the MMORPGs should be fined for not creating an internal court system to deal with issues like item theft. Beyond that though, any violence that spills out into real-life is just that, real and they (the perpetrators) deserve the same penalties given to any other RL act.
All I can say about the taxation of virtual items is that it's re-election time and all sorts of political stupidity is made into law...just look at Bush's recent actions.
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Nonsense
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Virtual Taxes
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WTF?
Politicians who do anything with technology shouldn't be old geezers and hags who have absolutely NO comprehension of what they're talking about or the implications of their actions.
Technology has accellerated so fast that it's really necessary now more than ever to have specialists in charge of technology-law (or working with politicians as equals).
The "Save the Internet" movement is a blatant example of how people who don't understand the subject, shouldn't make up laws to govern it.
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Uh, yeah, legally not workable.
You can't tax me on things I don't actually own.
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These idiots should be *fired* for wasting taxpayer $.
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what?
But the people in congress seem intent on chasing pages and living in their own fantasy worlds. Perhaps thats why they feel its taxable, they already are in a fantasy world...
If this is true. then to congress : get a life
if this is a joke... then wot ever...
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n00bs!
Would the Gov. have to pay the company for the accounts they use, i so when ppl find out about the identities of the players, they just imprison tham in a room with no windows or doors and leave them there to waste the rest of thier monthly access. Players would make monkeys out of governement officials so fast it just wouldn't be funney.
What next, the US gov paying ppl to play BF2 to stop us stealing equipment form the US army, or taxing us on what we take, or sending us to Gitmo for loading up a jeep with C4 and sending it into the enemy base? How do they decide what to tax - D&D 3D? some ancient MUD? RTS online games, where your country has money - do you own the money even if you just set up the server for a few hours?
You could go on forever.
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The value of in game objects is already taxed
So, if your super-rare magic sword increases drastically in value, it makes no difference to you until you sell it on ebay. If, after expenses, your sword selling/gold mining/crafting/whatever business is profitable, you can then deduct your monthly game fee, your internet connection, your computer(s), your office furniture, etc. as business expenses.
The system is already flexible enough to handle this. I don't even think it's relevant whether the TOS allows sales. The consequences of not having it explicitly written into the tax code are:
- No recourse if the sword is lost, stolen, or devalued. (If you bought it on ebay, you can still deduct the loss) So EO players can breathe easy.
- You don't have to add the sword to your Schedule D.
- No recourse if the game company takes your sword and bans you for violating their TOS.
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I hate congress
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cant happen
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Political Suicide
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where to find
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A virtual world
One thing that a lot of people have missed in this recent economic down turn is the fact that in-game money for all of the massive mutliplayer online role playing games has not been effected. I guess it just shows how strong and stable the computer game industry really is.
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mukesh251
Virtual Currency - Virtual Currency
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