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V-Bucks are not a "representation of value", and if you don't understand that there's an FAQ that goes into even more painful detail: https://www.irs.gov/indivi

V-Bucks are not a "representation of value", and if you don't understand that there's an FAQ that goes into even more painful detail: https://www.irs.gov/individuals/international-taxpayers/frequently-asked-questions-on-virtual-currency-transactions https://www.irs.gov/individuals/international-taxpayers/freq... > Virtual currency is a digital representation of value, other than a representation of the U.S. dollar or a foreign currency (“real currency”), that functions as a unit of account, a store of value, and a medium of exchange. Some virtual currencies are convertible, which means that they have an equivalent value in real currency or act as a substitute for real currency. The IRS uses the term “virtual currency” in these FAQs to describe the various types of convertible virtual currency that are used as a medium of exchange, such as digital currency and cryptocurrency. Video game currencies are (generally, if your game lets you convert the in-game currency to USD you might actually want to report it) NOT: 1. A store/representation of value 2. Convertible to a real currency 3. A medium of exchange

lmm 4y ago
> Virtual currency is a digital representation of value, other than a representation of the U.S. dollar or a foreign currency (“real currency”), that functions as a unit of account, a store of value, and a medium of exchange. This implies that things that aren't virtual currencies can still be a "representation of value". > Video game currencies are (generally, if your game lets you convert the in-game currency to USD you might actually want to report it) NOT: > 1. A store/representation of value How are they not? Certainly under the plain face meanings of those words they are. There's a reason we call them "currencies".
- cmeacham98 4y ago
  > This implies that things that aren't virtual currencies can still be a "representation of value". Of course, for example: stocks/bonds. > How are they not? Certainly under the plain face meanings of those words they are. There's a reason we call them "currencies". They only have value in the video game world of Fortnite, not the real world. Nobody accepts V-Bucks for payment of goods/services.
basch 4y ago
How is a gift card that lets me buy virtual costumes not a "a store of value and a medium of exchange?" It's literally a medium that is accepted as payment for clothing, dance moves, music etc in the store. Kids are doing chores in exchange for vbucks. They can take that gift card and sell it to a friend for USD. On that note, where does it say it needs to be convertible back into USD? It's only "unconvertable" once its redeemed. Plus, you can always sell your account, despite it being against TOS. Obviously the IRS doesnt care one way or another if the value of the vbucks is pegged or inflates, as there would be no capital gains.

lmm 4y ago

> Virtual currency is a digital representation of value, other than a representation of the U.S. dollar or a foreign currency (“real currency”), that functions as a unit of account, a store of value, and a medium of exchange. This implies that things that aren't virtual currencies can still be a "representation of value". > Video game currencies are (generally, if your game lets you convert the in-game currency to USD you might actually want to report it) NOT: > 1. A store/representation of value How are they not? Certainly under the plain face meanings of those words they are. There's a reason we call them "currencies".

cmeacham98 4y ago
> This implies that things that aren't virtual currencies can still be a "representation of value". Of course, for example: stocks/bonds. > How are they not? Certainly under the plain face meanings of those words they are. There's a reason we call them "currencies". They only have value in the video game world of Fortnite, not the real world. Nobody accepts V-Bucks for payment of goods/services.

basch 4y ago

How is a gift card that lets me buy virtual costumes not a "a store of value and a medium of exchange?" It's literally a medium that is accepted as payment for clothing, dance moves, music etc in the store. Kids are doing chores in exchange for vbucks. They can take that gift card and sell it to a friend for USD. On that note, where does it say it needs to be convertible back into USD? It's only "unconvertable" once its redeemed. Plus, you can always sell your account, despite it being against TOS. Obviously the IRS doesnt care one way or another if the value of the vbucks is pegged or inflates, as there would be no capital gains.