Seriously, this thread has gone off the rails into insane conspiracy theory territory.
People talk about how cult like it is when you actually buy into the crypto and NFT game, but man, listening to some of you talk about these assets, where little to no knowledge of how it actually works is known, has turned into its own cult like misinformation campaign.
Again, if you play a pay to earn game, you never have to sell the items you earn. If you do sell them, you never have to cash out the currency you receive and you just roll it into buying other items, and NO you don't need to pay taxes on the crypto you receive or spend that isn't cashed out into fiat.
Come on son. You guys are smarter than this. You don't have to like it, but at least dislike NFTs and crypto for what they are and not for the insane boogeyman ideas that live in your head about it.
Seriously, this thread has gone off the rails into insane conspiracy theory territory.
People talk about how cult like it is when you actually buy into the crypto and NFT game, but man, listening to some of you talk about these assets, where little to no knowledge of how it actually works is known, has turned into its own cult like misinformation campaign.
Again, if you play a pay to earn game, you never have to sell the items you earn. If you do sell them, you never have to cash out the currency you receive and you just roll it into buying other items, and NO you don't need to pay taxes on the crypto you receive or spend that isn't cashed out into fiat.
Come on son. You guys are smarter than this. You don't have to like it, but at least dislike NFTs and crypto for what they are and not for the insane boogeyman ideas that live in your head about it.
How the fuck do you P2E if you don’t make money? Are you saying this is a fraud from the get go?
You think it’s humorous?
The government comes after you for every nickel. You get caught cheating them, it’s going to cost you.
They don’t give a fuck whether you owe them 5 bucks or 5 million and they will charge compounded interest retroactively.
Not very funny in my book.
Or are Video Gamers exempt from all the taxes the rest of us have to pay.
Seriously, this thread has gone off the rails into insane conspiracy theory territory.
People talk about how cult like it is when you actually buy into the crypto and NFT game, but man, listening to some of you talk about these assets, where little to no knowledge of how it actually works is known, has turned into its own cult like misinformation campaign.
Again, if you play a pay to earn game, you never have to sell the items you earn. If you do sell them, you never have to cash out the currency you receive and you just roll it into buying other items, and NO you don't need to pay taxes on the crypto you receive or spend that isn't cashed out into fiat.
Come on son. You guys are smarter than this. You don't have to like it, but at least dislike NFTs and crypto for what they are and not for the insane boogeyman ideas that live in your head about it.
How the fuck do you P2E if you don’t make money? Are you saying this is a fraud from the get go?
You think it’s humorous?
The government comes after you for every nickel. You get caught cheating them, it’s going to cost you.
They don’t give a fuck whether you owe them 5 bucks or 5 million and they will charge compounded interest retroactively.
Not very funny in my book.
Or are Video Gamers exempt from all the taxes the rest of us have to pay.
Nothing but a pipe dream
You should calm down. It's really not that difficult to understand.
Let me ask you this. I own a ton of crypto assets. I own at least 20 blankos right now. Some I earned through their season pass.
How much is a Billy Bones Blanko worth? How much is the government going to come and collect from me?
And if I sell it and it goes into my mythical balance, it isn't in USD or even another crypto currency yet. If I decide to pull it out as ethereum, and the price of ethereum goes down before I transfer it into fiat, how much is it worth then?
Seriously you're smarter than this.
How is the government going to know what the value of anything is until it's been taken out into a fiat currency?
And as long as its digital currency, within the game, they aren't going to tax you on it, but you can still spend within that ecosystem.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
At that point its open to whatever you can get. So that means if I wanted to sell my Disney Dollars for another currency, how much are those dollars worth? The same? More? Less?
As long as the currency is still a proprietary token, and stays within the game, you can exchange it for other items within the game, without taking it out as fiat, or being taxed on it.
It's really not that hard to understand. It's not a fraud, or a scam, it's a simple virtual economy.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
"The big problem for me isn't NFTs, or crypto, or block-chain; but rather, that these technologies keep being presented as the second coming of gaming. A monetization scheme should be in the background and certainly should never qualify as an advertised feature of the game. If a game is good, nobody is going to care about the monetization."
Greed has overtaken gaming to the point where the game is secondary to the monetization. The first thing we see about these games isn't amazing new gameplay, innovative new features but monetization front and center. The monetization is literally the main feature of these games, to the detriment of everything else. To the point where we expect these games to be broken buggy messes but we all know one thing will work, the money taking part.
When I play a game my focus is not money, it's fun. All of these games just look like blatant cash grabs to me. The future of gaming is not going to be a monetization scheme it's going to be actual innovation in gameplay.
"You CAN'T buy ships for RL money." - MaxBacon
"classification of games into MMOs is not by rational reasoning" - nariusseldon
Seriously, this thread has gone off the rails into insane conspiracy theory territory.
People talk about how cult like it is when you actually buy into the crypto and NFT game, but man, listening to some of you talk about these assets, where little to no knowledge of how it actually works is known, has turned into its own cult like misinformation campaign.
Again, if you play a pay to earn game, you never have to sell the items you earn. If you do sell them, you never have to cash out the currency you receive and you just roll it into buying other items, and NO you don't need to pay taxes on the crypto you receive or spend that isn't cashed out into fiat.
Come on son. You guys are smarter than this. You don't have to like it, but at least dislike NFTs and crypto for what they are and not for the insane boogeyman ideas that live in your head about it.
How the fuck do you P2E if you don’t make money? Are you saying this is a fraud from the get go?
You think it’s humorous?
The government comes after you for every nickel. You get caught cheating them, it’s going to cost you.
They don’t give a fuck whether you owe them 5 bucks or 5 million and they will charge compounded interest retroactively.
Not very funny in my book.
Or are Video Gamers exempt from all the taxes the rest of us have to pay.
Nothing but a pipe dream
You should calm down. It's really not that difficult to understand.
Let me ask you this. I own a ton of crypto assets. I own at least 20 blankos right now. Some I earned through their season pass.
How much is a Billy Bones Blanko worth? How much is the government going to come and collect from me?
And if I sell it and it goes into my mythical balance, it isn't in USD or even another crypto currency yet. If I decide to pull it out as ethereum, and the price of ethereum goes down before I transfer it into fiat, how much is it worth then?
Seriously you're smarter than this.
How is the government going to know what the value of anything is until it's been taken out into a fiat currency?
And as long as its digital currency, within the game, they aren't going to tax you on it, but you can still spend within that ecosystem.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
At that point its open to whatever you can get. So that means if I wanted to sell my Disney Dollars for another currency, how much are those dollars worth? The same? More? Less?
As long as the currency is still a proprietary token, and stays within the game, you can exchange it for other items within the game, without taking it out as fiat, or being taxed on it.
It's really not that hard to understand. It's not a fraud, or a scam, it's a simple virtual economy.
If you sold your crypto, NFT’s etc. etc. and profited $500 you better add that to your income because if you don’t and you get caught, you will have to pay the taxes owed with interest or if the government thinks you were slimy about it they might slap you with a nice penalty.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I don't know what the laws are in the U.S. or its States, but in Canada once you pass a certain threshold in sales, you have to register for a sales tax number and start collecting sales tax for the government. Taxes are collected and sent to the government quarterly.
I had to get a personal sales tax number when I purchased my home, because it was once used as a business, which meant the property was subject to sales tax. With the tax number I can just defer and let the next owner worry about it.
You pay accountants and lawyers to learn these types of things.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
This is what confuses me. I thought the whole allure of crypto in games was making real money to spend.
So how are the two cryptos different?
(BTW, can anyone else hear BCBully screaming off in the distance?)
I suppose that is one allure of NFTs in games, to make assets that can then be sold for real money.
But that is only a part of the theory of earning these assets. In my opinion, it's not specifically so that you make money, but more along the lines that you don't completely lose money, as you're able to sell assets when you no longer want them. But we're really splitting hairs here.
So lets take NFTs out in the wild as an example.
If you buy a boredape for 40 ethereum or about 125K dollars, you would need to pay property taxes the NFT you bought, and potentially capital gains taxes if you hadn't paid it on any ETH gains you earned.
If you were gifted the same NFT you'd generally be charged with paying the floor price on property tax. You are generally taxed by the sale of others in the collection.
But with gaming crypto, it's a little different. The value is far more subjective and the currency you usually sell and trade is proprietary in a lot of cases. Items range in values so there is technically no floor price to base it off of. Even if you take a simple collection into consideration of the same character, mint number changes the value substantially, and the worth of the item could change depending on what you do with the item.
So in gaming crypto you can't tax on the worth of the item until you sell it. By owning it you have the potential to add and change the worth of something that begins with little inherent value, so it can't be taxed until it's sold.
One thing I have noticed is that no NFT games have good graphics or even good concept art. This is one reason why I believe NFT games never be mainstream. They just don't look good.
Maybe the people that make them just don't have the talent. Or maybe the people who do have the talent just aren't interested in making these types of products.
One thing I have noticed is that no NFT games have good graphics or even good concept art. This is one reason why I believe NFT games never be mainstream. They just don't look good.
Maybe the people that make them just don't have the talent. Or maybe the people who do have the talent just aren't interested in making these types of products.
They don't want to sell you a game, they want to sell you pixels.
One thing I have noticed is that no NFT games have good graphics or even good concept art. This is one reason why I believe NFT games never be mainstream. They just don't look good.
Maybe the people that make them just don't have the talent. Or maybe the people who do have the talent just aren't interested in making these types of products.
To make a good game, you need artists, story editors, programmers, system designers, etc. None of them are experts in NFT. So to make an NFT game, you need to hire NFT people. And if resources are limited, you'll cut back on art, stories, etc.
Just ask yourself, would I play 1,000's of hours in an NFT game if it wasn't NFT? Would I play this game just for fun?
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I understand what you are saying and yes, in the US your STATE income tax liability will change, just like anything else related to your State, but your Federal will not. Also, I do not know if it is settled as to WHERE your item is earned. Did you earn it in Florida where you live or did you earn it in Seattle where the server resides, or did you earn it in Canada where the company's address is?
And remember, while what you are discussing is items you BUY with crypto... If there is an NFT drop (Sword of Doom) and if that Sword of Doom has a value that they can estimate, then you owe tax on that regardless of whether you sell it or not. These should be treated as Collectibles and taxed on perceived value at receipt.
You will 99% get away with non-reporting now... but in the future I am 100% confident that they will enforce it. Just like they mandate Amazon and online retailers collect sales tax now.
All time classic MY NEW FAVORITE POST! (Keep laying those bricks)
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Proudly wearing the Harbinger badge since Dec 23, 2017.
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Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I understand what you are saying and yes, in the US your STATE income tax liability will change, just like anything else related to your State, but your Federal will not. Also, I do not know if it is settled as to WHERE your item is earned. Did you earn it in Florida where you live or did you earn it in Seattle where the server resides, or did you earn it in Canada where the company's address is?
And remember, while what you are discussing is items you BUY with crypto... If there is an NFT drop (Sword of Doom) and if that Sword of Doom has a value that they can estimate, then you owe tax on that regardless of whether you sell it or not. These should be treated as Collectibles and taxed on perceived value at receipt.
You will 99% get away with non-reporting now... but in the future I am 100% confident that they will enforce it. Just like they mandate Amazon and online retailers collect sales tax now.
This is completely dependent on whether the "drop" was airdropped or a drop from within a game, and what the drop corresponds to.
For example, as I said I have several blankos and some of them are given through prime, but the most recent one given out hasn't even been listed or sold on the market at all. Not a single one. There would be no decisive taxable amount to pull from.
It could be murky, but as of right now, when I do my taxes, it is significantly less murky as long as I'm not selling them.
Now if I turn around and sell that blanko for 10 grand, well, yeah, that's going to cost me. Some gaming NFTs already do charge sales tax on an initial purchase, but they don't when you resell. You wouldn't have to pay sales tax on that, as it would be considered a "private sale" even if the sale is on a proprietary market.
Honestly I do hope they regulate it in the future.
The main issue right now for me isn't the costs, or the taxes, or the implications, it's how difficult it is for the average gamer to understand it and get involved.
Pretty much every blockchain game that tries to leverage NFTs or bridge to main net is so freaking difficult to understand with the multitude of wallets, main net changes, purchase prices with gas fees.
Even if everyone was on board with the idea of blockchain gaming, trying to get into some of these games is way too convoluted for the average gamer they would HAVE to pay you or it isn't worth the effort.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I understand what you are saying and yes, in the US your STATE income tax liability will change, just like anything else related to your State, but your Federal will not. Also, I do not know if it is settled as to WHERE your item is earned. Did you earn it in Florida where you live or did you earn it in Seattle where the server resides, or did you earn it in Canada where the company's address is?
And remember, while what you are discussing is items you BUY with crypto... If there is an NFT drop (Sword of Doom) and if that Sword of Doom has a value that they can estimate, then you owe tax on that regardless of whether you sell it or not. These should be treated as Collectibles and taxed on perceived value at receipt.
You will 99% get away with non-reporting now... but in the future I am 100% confident that they will enforce it. Just like they mandate Amazon and online retailers collect sales tax now.
This is completely dependent on whether the "drop" was airdropped or a drop from within a game, and what the drop corresponds to.
For example, as I said I have several blankos and some of them are given through prime, but the most recent one given out hasn't even been listed or sold on the market at all. Not a single one. There would be no decisive taxable amount to pull from.
It could be murky, but as of right now, when I do my taxes, it is significantly less murky as long as I'm not selling them.
Now if I turn around and sell that blanko for 10 grand, well, yeah, that's going to cost me. Some gaming NFTs already do charge sales tax on an initial purchase, but they don't when you resell. You wouldn't have to pay sales tax on that, as it would be considered a "private sale" even if the sale is on a proprietary market.
Honestly I do hope they regulate it in the future.
The main issue right now for me isn't the costs, or the taxes, or the implications, it's how difficult it is for the average gamer to understand it and get involved.
Pretty much every blockchain game that tries to leverage NFTs or bridge to main net is so freaking difficult to understand with the multitude of wallets, main net changes, purchase prices with gas fees.
Even if everyone was on board with the idea of blockchain gaming, trying to get into some of these games is way too convoluted for the average gamer they would HAVE to pay you or it isn't worth the effort.
They always did collect sales tax for online shopping. The difference was whether you were an international or a domestic customer.
Now it no longer matters, I pay Canadian sales tax no matter the origin of the online retailer.
One thing I have noticed is that no NFT games have good graphics or even good concept art. This is one reason why I believe NFT games never be mainstream. They just don't look good.
Maybe the people that make them just don't have the talent. Or maybe the people who do have the talent just aren't interested in making these types of products.
The 'artwork' has to be set up like a Mr. Potato Head so that different colors/textures/elements can be combined in different ways to create unique NFTs.
There is no reason to want a cheetah spotted monkey wearing a crown. The only thing that could make a person want something that repulsive is to wrap it in an NFT candy coating and pretend it has value.
It is so stupid as to be causing me physical pain.
That aside, I feel bad for the NFTs fanbois here because honestly, guys, you're gonna be taking a beating for a bit while all the scam artists work their way through this thing. We're going to be seeing quite a bit of trash... now you know how I feel when my wife walks in the room and sees an ad for underaged anime tittie porn in the MMORPG sidebars.
We suffer fools for what we love.
SMH , didn't you get the Memo , its is no longer acceptable to call it Mr Potato Head ..
We're going to be seeing quite a bit of trash... now you know how I feel when my wife walks in the room and sees an ad for underaged anime tittie porn in the MMORPG sidebars.
Yeah, I use adblock when MMORPG.com runs those ads.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
So if I make millions in crypto, and then buy a Tesla, the money I made to buy the car is tax free because it never passed through USD?
That's different. A tesla isn't a virtual good within a closed ecosystem. You would then be taxed on the price of the car.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Sales tax, yes, but I'm talking income tax.
So depending on where you live, this can completely change. In most areas crypto tokens are considered property. The same with NFTs in some countries, and it can vary based on states in the US too.
So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I understand what you are saying and yes, in the US your STATE income tax liability will change, just like anything else related to your State, but your Federal will not. Also, I do not know if it is settled as to WHERE your item is earned. Did you earn it in Florida where you live or did you earn it in Seattle where the server resides, or did you earn it in Canada where the company's address is?
And remember, while what you are discussing is items you BUY with crypto... If there is an NFT drop (Sword of Doom) and if that Sword of Doom has a value that they can estimate, then you owe tax on that regardless of whether you sell it or not. These should be treated as Collectibles and taxed on perceived value at receipt.
You will 99% get away with non-reporting now... but in the future I am 100% confident that they will enforce it. Just like they mandate Amazon and online retailers collect sales tax now.
This is completely dependent on whether the "drop" was airdropped or a drop from within a game, and what the drop corresponds to.
For example, as I said I have several blankos and some of them are given through prime, but the most recent one given out hasn't even been listed or sold on the market at all. Not a single one. There would be no decisive taxable amount to pull from.
It could be murky, but as of right now, when I do my taxes, it is significantly less murky as long as I'm not selling them.
Now if I turn around and sell that blanko for 10 grand, well, yeah, that's going to cost me. Some gaming NFTs already do charge sales tax on an initial purchase, but they don't when you resell. You wouldn't have to pay sales tax on that, as it would be considered a "private sale" even if the sale is on a proprietary market.
Honestly I do hope they regulate it in the future.
The main issue right now for me isn't the costs, or the taxes, or the implications, it's how difficult it is for the average gamer to understand it and get involved.
Pretty much every blockchain game that tries to leverage NFTs or bridge to main net is so freaking difficult to understand with the multitude of wallets, main net changes, purchase prices with gas fees.
Even if everyone was on board with the idea of blockchain gaming, trying to get into some of these games is way too convoluted for the average gamer they would HAVE to pay you or it isn't worth the effort.
They always did collect sales tax for online shopping. The difference was whether you were an international or a domestic customer.
Now it no longer matters, I pay Canadian sales tax no matter the origin of the online retailer.
Not here in the US. We were supposed to "self-report".. umm... yeah
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People talk about how cult like it is when you actually buy into the crypto and NFT game, but man, listening to some of you talk about these assets, where little to no knowledge of how it actually works is known, has turned into its own cult like misinformation campaign.
Again, if you play a pay to earn game, you never have to sell the items you earn. If you do sell them, you never have to cash out the currency you receive and you just roll it into buying other items, and NO you don't need to pay taxes on the crypto you receive or spend that isn't cashed out into fiat.
Come on son. You guys are smarter than this. You don't have to like it, but at least dislike NFTs and crypto for what they are and not for the insane boogeyman ideas that live in your head about it.
You think it’s humorous?
The government comes after you for every nickel. You get caught cheating them, it’s going to cost you.
They don’t give a fuck whether you owe them 5 bucks or 5 million and they will charge compounded interest retroactively.
Not very funny in my book.
Or are Video Gamers exempt from all the taxes the rest of us have to pay.
Nothing but a pipe dream
"Be water my friend" - Bruce Lee
Let me ask you this. I own a ton of crypto assets. I own at least 20 blankos right now. Some I earned through their season pass.
How much is a Billy Bones Blanko worth? How much is the government going to come and collect from me?
And if I sell it and it goes into my mythical balance, it isn't in USD or even another crypto currency yet. If I decide to pull it out as ethereum, and the price of ethereum goes down before I transfer it into fiat, how much is it worth then?
Seriously you're smarter than this.
How is the government going to know what the value of anything is until it's been taken out into a fiat currency?
And as long as its digital currency, within the game, they aren't going to tax you on it, but you can still spend within that ecosystem.
Like if you own Disney Dollars at the theme park, and lets say any item you buy they give you your change in Disney Dollars, as long as you're within the Disney property everything you buy uses that system, but the moment you step outside of it, what are the dollars worth?
At that point its open to whatever you can get. So that means if I wanted to sell my Disney Dollars for another currency, how much are those dollars worth? The same? More? Less?
As long as the currency is still a proprietary token, and stays within the game, you can exchange it for other items within the game, without taking it out as fiat, or being taxed on it.
It's really not that hard to understand. It's not a fraud, or a scam, it's a simple virtual economy.
Equally so if you bought a sandwich with bitcoin. You'd be taxed on the cost of the sandwich.
Otherwise if you made "millions" on crypto today and the market crashed tomorrow, how many millions would you be taxed on?
Greed has overtaken gaming to the point where the game is secondary to the monetization. The first thing we see about these games isn't amazing new gameplay, innovative new features but monetization front and center. The monetization is literally the main feature of these games, to the detriment of everything else. To the point where we expect these games to be broken buggy messes but we all know one thing will work, the money taking part.
When I play a game my focus is not money, it's fun. All of these games just look like blatant cash grabs to me. The future of gaming is not going to be a monetization scheme it's going to be actual innovation in gameplay.
"classification of games into MMOs is not by rational reasoning" - nariusseldon
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So, yes you would pay sales tax, but you'd also likely have to pay additional fees related to the amount you pulled out, AND the gas fees associated -- UNLESS you already paid taxes based on the initial amount you spent.
It's all about what your country requires, but generally, crypto currency and game crypto are different in a few different ways.
So in instances where NFTs are taxed as property, crypto you earn inherently doesn't have a floor price, so you can't determine a worth to claim until its sold.
There are areas where NFTs that are gifted or airdropped have instances where the governmet would attempt to claim property tax on those items, but in the event this happens, it's usually a floor price, which is usually extremely low.
You do pay income tax on crypto you cash out, and that includes for cars.
Sure, this is all subject ot change. But in play to earn games you only pay taxes when you sell or swap it for goods based on your profit.
Again I've been part of this crypto world for a couple years now and where I am, my tax accountant went through all of my holdings. Game crypto wasn't even a factor since I hadn't sold or swapped any of it.
I had to get a personal sales tax number when I purchased my home, because it was once used as a business, which meant the property was subject to sales tax. With the tax number I can just defer and let the next owner worry about it.
You pay accountants and lawyers to learn these types of things.
"Be water my friend" - Bruce Lee
The tl:dr is that there won't be much difference when the aspect of making money out of the virtual assets is concerned, it's what the hook is.
But that is only a part of the theory of earning these assets. In my opinion, it's not specifically so that you make money, but more along the lines that you don't completely lose money, as you're able to sell assets when you no longer want them. But we're really splitting hairs here.
So lets take NFTs out in the wild as an example.
If you buy a boredape for 40 ethereum or about 125K dollars, you would need to pay property taxes the NFT you bought, and potentially capital gains taxes if you hadn't paid it on any ETH gains you earned.
If you were gifted the same NFT you'd generally be charged with paying the floor price on property tax. You are generally taxed by the sale of others in the collection.
But with gaming crypto, it's a little different. The value is far more subjective and the currency you usually sell and trade is proprietary in a lot of cases. Items range in values so there is technically no floor price to base it off of. Even if you take a simple collection into consideration of the same character, mint number changes the value substantially, and the worth of the item could change depending on what you do with the item.
So in gaming crypto you can't tax on the worth of the item until you sell it. By owning it you have the potential to add and change the worth of something that begins with little inherent value, so it can't be taxed until it's sold.
Maybe the people that make them just don't have the talent. Or maybe the people who do have the talent just aren't interested in making these types of products.
"Be water my friend" - Bruce Lee
------------
2024: 47 years on the Net.
And remember, while what you are discussing is items you BUY with crypto... If there is an NFT drop (Sword of Doom) and if that Sword of Doom has a value that they can estimate, then you owe tax on that regardless of whether you sell it or not. These should be treated as Collectibles and taxed on perceived value at receipt.
You will 99% get away with non-reporting now... but in the future I am 100% confident that they will enforce it. Just like they mandate Amazon and online retailers collect sales tax now.
All time classic MY NEW FAVORITE POST! (Keep laying those bricks)
"I should point out that no other company has shipped out a beta on a disc before this." - Official Mortal Online Lead Community Moderator
Proudly wearing the Harbinger badge since Dec 23, 2017.
Coined the phrase "Role-Playing a Development Team" January 2018
"Oddly Slap is the main reason I stay in these forums." - Mystichaze April 9th 2018
For example, as I said I have several blankos and some of them are given through prime, but the most recent one given out hasn't even been listed or sold on the market at all. Not a single one. There would be no decisive taxable amount to pull from.
It could be murky, but as of right now, when I do my taxes, it is significantly less murky as long as I'm not selling them.
Now if I turn around and sell that blanko for 10 grand, well, yeah, that's going to cost me. Some gaming NFTs already do charge sales tax on an initial purchase, but they don't when you resell. You wouldn't have to pay sales tax on that, as it would be considered a "private sale" even if the sale is on a proprietary market.
Honestly I do hope they regulate it in the future.
The main issue right now for me isn't the costs, or the taxes, or the implications, it's how difficult it is for the average gamer to understand it and get involved.
Pretty much every blockchain game that tries to leverage NFTs or bridge to main net is so freaking difficult to understand with the multitude of wallets, main net changes, purchase prices with gas fees.
Even if everyone was on board with the idea of blockchain gaming, trying to get into some of these games is way too convoluted for the average gamer they would HAVE to pay you or it isn't worth the effort.
Now it no longer matters, I pay Canadian sales tax no matter the origin of the online retailer.
"Be water my friend" - Bruce Lee
------------
2024: 47 years on the Net.
All time classic MY NEW FAVORITE POST! (Keep laying those bricks)
"I should point out that no other company has shipped out a beta on a disc before this." - Official Mortal Online Lead Community Moderator
Proudly wearing the Harbinger badge since Dec 23, 2017.
Coined the phrase "Role-Playing a Development Team" January 2018
"Oddly Slap is the main reason I stay in these forums." - Mystichaze April 9th 2018