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it will become the first company in the United States to pay bitcoin fees.
The online retailer will benefit from a program in Ohio, announced in November, to pay a portion of his taxes using cryptocurrency. Overstock was one of the first to adopt bitcoin
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becoming one of the first major retailers to accept bitcoins for payment on their site in 2014.
Overstock's chief executive officer and founder, Patrick M. Byrne, stated in a statement that "the thoughtful adoption by the government of emerging technologies, if accompanied by non-restrictive legislation on these technologies" is the best way to be followed for the United States and other advanced economies.
The plan might seem like a gimmick, but in reality it could be a money saving for companies in the encrypted space, said Neeraj Agrawal, director of communications in Washington, Washington's cryptocurrency research center.
The same applies to people trying to pay their personal income taxes with cryptocurrency, which is also permitted in Ohio. "This would be a good idea for a company that already has a lot of bitcoins because it saves them the step of converting their bitcoins into dollars before paying taxes," he said. "Now they will be converted right at the time of payment."
As with all cryptocurrency payments, the transaction will trigger tax on capital gains on the bitcoin used to pay taxes, so you will have to pay taxes on your taxes.
As with all cryptocurrency payments, the transaction will trigger tax on capital gains on the bitcoin used to pay taxes. In other words, you will have to pay taxes on your taxes.
While this might seem like a headache, it can actually help people who have lost money in the volatile bitcoin year, said Farrukh Shaikh, chief financial officer and co-founder of Gath3r, a cryptocurrency mining service.
If the current price of bitcoin is higher than the price originally paid, then you should pay an additional tax on the gain now made from the bitcoin payment. However, if the current price of bitcoin is lower than the base price, then it is a matter of realizing a loss on the bitcoin, which can be offset with the total bill and reduce it.
"The use of bitcoins to pay taxes can be interesting for people who are currently at a loss from their bitcoin entry price if they want to reduce their bitcoin investments and pay taxes over the same period," he said.
People must report whether each transaction was a loss or a gain, which can be difficult given the volatility of cryptocurrencies.
Bitcoin dropped from the highs of nearly $ 20,000 per currency in December 2017 to 10 consecutive sessions under $ 4000 at the end of 2018.
The Internal Revenue Service has not issued a detailed policy on how to pay taxes using cryptocurrency, in addition to a 2014 ruling stating that selling bitcoins is treated in the same way as selling property or any other capital. People must report each transaction in terms of loss or gain, which can be difficult given the volatility of cryptocurrencies.
Experts suggest filing taxes with an accountant, especially with a cryptocurrency expert, if you did business in bitcoins last year. So far, Ohio is the first and only state to accept bitcoin payments for taxes.
The Ohio State Treasurer, Josh Mandel, told Bitcoin magazine that the state wants to demonstrate that it is at the forefront of new technologies by announcing the new fiscal policy by announcing Ohiocrypto.com.
"We wanted to project into the rest of the country that Ohio is embracing technology and is a place that welcomes software developers and entrepreneurs who want to build a blockchain business here in the state of Ohio," he said.
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