Posts with tag GAO

If you're a World of Warcraft or Diablo 3 player, the federal government would like to have a word with you. Congress's U.S. Government Accountability Office (GAO), at the request of Senators Max Baucus (D-MT) and Orrin Hatch (R-UT), just wrote and filed a 23-page report on the tax implications of earning gold in MMORPGs. Seriously.

The report, titled "Virtual Economies and Currencies," focuses on buying, using, and selling virtual currencies like WoW gold. The key takeaway for World of Warcraft players is that the in-game economy is a "closed-flow system" -- because you can't exchange your gold for U.S. dollars, you don't need to worry about claiming those 26 gold pieces from completing a quest on your 2013 income taxes. If, however, you decide to sell your accumulated WoW items through a third-party exchange (Don't do it! It's against the Terms of Service and could get you hacked!), then you "may have earned taxable income from the sale of these virtual goods."