Quote from: bassjoe on September 05, 2013, 08:29:02 PM

Quote from: bitanarchy on August 13, 2013, 12:27:24 PM

Favors, like sex, are also a means of exchange. What is legally the difference between taxing virtual currency and taxing sex?

There is no difference because you're thinking about it incorrectly.

The IRS taxes INCOME. The IRS -- and most taxing agencies in the world -- define income extremely broadly. If you receive non-monetary favors in lieu of money to do something, you're still supposed to report that as income (if you don't know the monetary value of the favor, you make a reasonable guesstimate). If your sex is in exchange for a $1000 watch, then you report an income of $1000.

So the IRS is not taxing the medium of exchange directly; it is taxing however the value of the income you received in the exchange.

Correct.

But don't forget this.

If you don't report the value of the income, then the IRS may come out and seize your property. But in this case, the seizure would be of sexual favors.....