Quote from: Jobe7 on March 10, 2013, 12:21:09 AM

If you got paid a job in coconuts, I highly doubt a taxman will come and demand a % in tax of your coconuts.

The loop hole exists until a state adopts the currency. E.g. Starts to tax in bitcoins (which is possible, law derived to force employers to pay a % of their employees bitcoin wages as tax, before it goes to their wallet).

But again, like I said, this IS a desired outcome. Adoption of a new currency for the purpose of tax is a definite milestone.

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Exactly .. listen to what you're saying yourself .. you owe taxes on earnings .. IF your earnings is in bitcoin (i.e. you get paid in bitcoin at the 1st point), then you can't/don't declare any earnings. I dare you to (and I hope people do) phone up the tax office and say "Hi, I need to declare my earnings for the year, xxxx bitcoins."

What the system regards you as otherwise is a volunteer, working for nothing. Until a state recognizes bitcoins and decides to tax it.

And ye, this would ONLY work if your employer agreed to pay you in bitcoin.

People are already getting paid in bitcoins, and more will as the bitcoin businesses flourish, the early ones won't get taxed, spending as much bitcoin as they can AS bitcoin. Eventually a state will catch on, and will realise they have to include a new clause, "if you're paid in bitcoin you will get taxed bitcoin".

You can not enforce a law of "it is illegal to pay people in bitcoin" .. because how could you? you'd have to make it illegal to volunteer for anything, or do anything for anyone else, you'd never know if they were getting paid in bitcoin. The only way for a state would be, as you said, to tax it.

Last try.

http://www.irs.gov/Businesses/Small-Businesses-&-Self-Employed/Tax-Responsibilities-of-Bartering-Participants