Ohio First State to Accept Bitcoin for Taxes
Bitcoin and other cryptocurrencies have developed a bit of public stigma lately as prices have fallen and overnight “bitcoin millionaires” went back, in some cases, to their regular lives. At least one state has decided cryptocurrency is here to stay, however, so it might as well figure out a way to help residents use the currency to pay state taxes. Ohio is the first state in the United States to accept bitcoin tax payments using a real-time blockchain transaction facilitated by Atlanta-based BitPay, one of the first and largest cryptocurrency payment processors worldwide.
Wondering how much of your tax bill your bitcoin will pay off today? BitPay, via OhioCrypto.com, converts the bitcoin payment into U.S. dollars at the time of the payment, then deposits your payment directly into the Ohio Treasury. The treasury itself never actually “touches” the cryptocurrency because it is converted at the time of payment. BitPay and services like it say that although many fear cryptocurrency is open to more types of fraud than conventional methods of payment, the chances of payment fraud are actually lower with digital currencies than with other methods of payment, such as traditional debit processing, because all transactions on the blockchain may be viewed by anyone. Also BitPay charges far less per transaction (1 percent) than most credit or debit agencies.
“BitPay was started because we realized the potential for blockchain to revolutionize the financial industry, making payments faster, more secure, and less expensive on a global scale,” explained the company’s head of compliance, Jeremie Beaudry. BitPay offered a similar service in Seminole County, Florida, earlier this year, so that residents could use the currency to pay their property taxes, drivers license and I.D. card fees, and tag and title fees. At present, Ohio is only permitting digital currency for use in paying business taxes.
Ohio is representing the new option for paying taxes as an indicator that the state is “business friendly.” Josh Mandel, Ohio state treasurer, said, “We’re doing this to plant the flag in Ohio as a national and international leader in blockchain technology,” adding that the state considers the move “rolling out the red carpet for blockchain businesses.” Mandel continued that Ohio welcomes “all sorts of blockchain companies…not just in the cryptocurrency space.” Mandel said that as more and more states are competing for software engineers and other IT businesses, being open to bitcoin and blockchain technology businesses may set Ohio apart.
BitPay CEO Stephen Pair noted that businesses hoping to pay their taxes in bitcoin are unlikely to hoard the digital currency in hopes of prices rising in the future if they can easily use it to pay now. “Generally speaking, volatility up or down stimulates spending,” he said.
Would you take the opportunity to pay your business taxes or other fees and taxes with bitcoin?