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February 28, 2013, 06:11:03 PM |
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I think the reason you haven't received a response to your questions is because, no one really knows. I've read differing opinions as to what bitcoins really are, are they currency, are they a product and therefore inventory. Obviously the IRS doesn't know. I think the key point is that you choose one. Decide whether you will treat them as currency or treat them as a product part of your inventory then utilize GAAP to value your currency or inventory. There are benefits and disadvantages to treating bitcoin in either manner. If a currency, you benefit from a lower capital gains rate if you are an active trader. If a product, then you can utilize COGS to reduce your top line figure. In either case you must value the bitcoin at the end of each accounting period. No way around that. It's the same way a bank has to mark to market it's book, or grocery store has to value it's inventory of fruit. I hope this has viewpoint has been of value to you.
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