The IRS has officially stated that bitcoin is a property – similar to any other valuable commodity – rather than a currency. What does this mean? Not much. In short, if you pay someone in bitcoin – in the same way you could pay them in gold – the wages are taxed accordingly. It is also not considered legal tender but a capital asset.
The key line is here: “A payment made using virtual currency is subject to information reporting to the same extent as any other payment made in property.” Furthermore:
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