Online communities getting slapped by the IRS?

LONDON (Reuters) - Users of online worlds such as Second Life and World of Warcraft transact millions of dollars worth of virtual goods and services every day, and these virtual economies are beginning to draw the attention of real-world authorities.

"Right now we're at the preliminary stages of looking at the issue and what kind of public policy questions virtual economies raise -- taxes, barter exchanges, property and wealth," said Dan Miller, senior economist for the Joint Economic Committee of the U.S. Congress.

"You could argue that to a certain degree the law has fallen (behind) because you can have a virtual asset and virtual capital gains, but there's no mechanism by which you're taxed on this stuff," he told Reuters in a telephone interview.

My god... next thing you know when I go to buy that shiny new level 50 sword on the AH I'm going to have to give the government $2 in taxes for "acquiring virtual property".

Now, I can understand taxing Second Life as it's whole shtick is real world money as in game currency and vice versa, but games like World of Warcraft? I'm sorry, I just don't see how being taxed to buy a chainmail breastplate that I'm going to wear for 4 levels in an imaginary world should be a viable capability of the United States Government.

Want to make an MMO crash and burn? Let the government tax its transactions. I like WoW, but not that much.

Full Article Here

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