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Reader Comments (6)

Posted: May 2nd 2010 10:02AM (Unverified) said

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In Second Life you may have intellectual property rights in items you created (a texture for example), but according to the TOS you do not own the database which merely tracks who may access your items. Since the database entries (your inventory list) are subject to deletion on a whim, they are not *yours*. Property implies legal control of an object, and SL assets fail that test. A real life example is if you have a business and store your inventory in a rented warehouse. The warehouse owner would not have the right to destroy your items just because they felt like it.

Even your US$ account balance may be subject to random deletion, and thus is not *your* money yet. Certainly once a "process credit" reaches Paypal, and you can go spend it on other things, at that point it is real income, as the funds are now in your control, and not subject to Linden Research's whims.

Posted: May 2nd 2010 10:08AM (Unverified) said

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Quite right on the ownership (and something I've written about before) - but the status of something as a taxable asset doesn't solely rely on ownership, but on who is able to realize the value of it. While extant examples are sort of rare, you can still be taxed for something you don't actually own, so long as you're the one who can lawfully profit from its sale or transfer.
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Posted: May 3rd 2010 9:33AM mattwo said

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taxes? YAWN

Posted: May 3rd 2010 12:58PM (Unverified) said

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Tateru, US states cannot enforce the consumer-use tax for online purchases; they've fallen back to asking merchants to charge it by the buyer's location.

Not all merchants do, of course :)

For the immediate future, taxing virtual currency and transactions will be far beyond the ken of most taxation departments, if my home state is any indication.

I don't know how international readers regard the US tax system: I once described it to a group of Europeans as a type of boring RPG played with multiple character sheets, the object being to level up one's income by finding the loopholes and assuming the GM was capricious and barely competent to run the campaign.

Posted: May 3rd 2010 1:04PM (Unverified) said

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Indeed, I've not included any mention of consumer-use or sales taxes. Just the income tax umbrella (CGT technically falls under the income tax codes)
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Posted: May 4th 2010 9:36PM (Unverified) said

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wait, so in the US you have to pay taxes over exchanging cassino chips?

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