Blackmoor Vituperative

If you are a hard-core player of virtual worlds like World of Warcraft, Second Life, EverQuest or There, IRS form 1099 may someday soon take on a new meaning for you.

That’s because game publishers may well in the not-too-distant future have to send the forms — which individuals receive when earning nonemployee income from companies or institutions — to virtual world players engaging in transactions for valuable items like Ultima Online castles, EverQuest weapons or Second Life currency, even when those players don’t convert the assets into cash.

Most governments are only beginning to become aware of the substantial economic activity in online games, but the games’ rapid growth and the substantial value of the many virtual assets changing hands in them is almost certain to bring them into the popular consciousness.

“Given growth rates of 10 to 15 percent a month, the question is when, not if, Congress and IRS start paying attention to these issues,” said Dan Miller, a senior economist with the Congress’ Joint Economic Committee, who is also a fan of virtual worlds. “So it is incumbent on us to set the terms and the debate so we have a shaped tax policy toward virtual worlds and virtual economies in a favorable way.”

(from IRS taxation of online game virtual assets inevitable | Tech News on ZDNet)

People, it’s time to call, write, AND email your legislators and get them onboard with the FairTax. This whole IRS nonsense just gets worse and worse and it’s long past time we replaced it. The income tax as it currently exists was a quick-fix when the US needed money for war — it’s gotten far more complicated than anyone who initially created it could have ever foreseen. It’s the 21st century, for pete’s sake. Let’s fix this problem now. We can, we should, and it’s only going to cost us more time, money, and energy the longer we put it off.

But in all seriousness, I do not see the IRS taxing your fictional character’s income any time soon. The idea is just too silly. Then again, I thought the same thing about the Digital Millennium Copyright Act, and that became law, so maybe there is no underestimating the intelligence of our well-meaning government employees.