Virtual economies and the use of virtual currencies intended as
alternatives to government
-
issued currencies are a recent phenomenon,
and the extent to which their use results in tax noncomp
liance is unknown. Given this uncertainty, available funding, and other priorities,
IRS made a reasoned decision not to implement a compliance approach
specific to virtual economies and currencies. However, IRS did see value in providing taxpayers with information on the tax consequences of virtual
economy transactions, a low
-
cost step to potentially mitigate some of the
noncompliance risk associated with such transactions. The uncertainty
about the extent virtual currencies are used in taxable transactions
and
any associated tax noncompliance means that
costly compliance
activities are not merited at this time. However, the fact that
misinformation is circulating and the possibility of growth in the use of
virtual currencies outside virtual economies suggest that it would be
prudent to take low
-
cost steps, if available, to mitigate potential
compliance risks. The type of information IRS provided about virtual
economy transactions is one model.
http://gao.gov/assets/660/654620.pdfRally may have some legs
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