…death and tax evasion.
I seriously thought gamers were a bunch of Democrats these days. Guess not.
I made a post earlier today that I felt worth expanding on. It dissappoints me how naively the gaming community opposes the taxation of virtual property, which thanks to the proliferation of game economies in venues like Second Life and World of Warcraft has brought legislative interests in like cultural vultures to a cash-stuffed corpse, which has begun turning the wheels in the dark recesses of the IRS’ mind. It is like a shudder in the Book of Revelations when Reuters decides to establish a virtual news bureau to investigate virtual news.
But it’s happening. And you’d be a fool to stand against it. Specifically, what’s being debated is that virtual transactions of either virtual goods or virtual currency is capitalized into real money. How much? There are a few individuals who make six digit salaries as black market dealers, (adult) service providers, and real-virtual-estate agents. Can one really expect the IRS to take a backseat to that?
Of course not. Income is income. Income is taxable, income SHOULD be taxable. It doesn’t matter if you’re engaged in the intangible businesses of gaming, or the intangible businesses of day-trading, education, entertainment, customer service, consultation, art, etc., if you’re making money, you should be taxed. The more interesting question is how asset value is determined. But I look forward to the day when I can write the cost of buying Warcraft off my taxes, or include the depreciation of my Second Life home on my Schedule A.
The most ignorant thing people said was that the EULA for the game prohibits sale of virtual assets, and therefore government is breaking the law trying to collect on in-game actions. It doesn’t matter if income is legal, illegal, magical, mystical, or genetically produced out of the ass of an X-man, it is TAXABLE.
I can’t wait until the controversy is stirred up further when Kojima’s stock market game comes out. It is possible the government will confuse realized and non-realized profits in the virtual economy. The current state of game regulation debate is looking bad, as we’re being caught between the “bring the government down on their corporate asses” Democrats, and the “morals aka sex should be regulated in all media” Republicans, turning the whole charade into a political lose-lose for video games. It’s high noon outside the virtual saloon, and the tumbleweeds are a’tumblin away from the gunfight.