Tuesday, February 27, 2024
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IRS says bitcoin is property rather than currency

The Internal Revenue Service said Tuesday that it will treat bitcoins, and similar virtual currencies as property, not currency for U.S. federal tax purposes.

"The notice provides that virtual currency is treated as property for U.S. federal tax purposes. General tax principles that apply to property transactions apply to transactions using virtual currency," according to an IRS news release announcing the change Tuesday.

The announcement also stated that wages paid and other payments made using bitcoin, and other virtual currency, are taxable and subject to information reporting to the same extent as any other payment made in property.

Last month, Benjamin Lawsky, superintendent of New York's Department of Financial Services, said he intends to provide regulations later this year, that could make New York the first U.S. state to regulate virtual currencies such as bitcoins.

Speaking at a conference on bitcoin in San Francisco on Tuesday, venture capitalist Marc Andreesen said: "New things (like bitcoin) just look new and scary [to people]."

"We're thinking about bitcoin as an enabling technology for other technologies," he said.

—By CNBC.com. Reuters contributed to this report.

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