Regions

You can now pay your taxes to IRS with Bitcoins - report

January 15
11:09 PM 2014

As Bitcoin goes mainstream and gain wider acceptance, more organizations are capitalizing on the digital currency's popularity while giving Bitcoin holders added value, Forbes Contributor Ben Kepes reported. SnapCard is one of them. The aim of the San Mateo-based startup is to make it possible to purchase stuff online with Bitcoin, the report said.

The SnapCard platform allows users to pay in the digital currency for their online purchases through a browser bookmarklet that combines a checkout process for the Bitcoin with ecommerce sites. Now this idea isn't really new as online payments and virtual currencies go together.

What is new with SnapCard is that it allows payment of tax debt using the digital currency. Kepes considers the innovation very unique as the "last bastion of hyper-cautious Government agencies meets the very bleeding edge of economics." As far as fees go, SnapCard will charge a flat $10 fee in addition to payment fees that will be collected by the IRS.

One of SnapCard's founders, Loannis Giannaros told Forbes that they will soon be growing the program to enable universal bitcoin-fueled payment. When this happens, the digital currency will replace bill-pay services offered by traditional lenders.

SnapCard works by using the Coinbase and BitPay platforms to turn Bitcoins to US dollars. The money is then paid to the payment processor and then transferred to the intended recipient, the report said.

A young company, SnapCard has only processed transactions amounting to $300,000 to date. This comes from a couple of thousand users, most of whom purchase from two popular ecommerce platforms, Amazon and eBay.

Kepes concludes, "Bitcoin might be a mere flash in the pan, but it is indicative of the seismic changes underway in the broader economy. These changes mean huge shifts for the traditional players, there's a tsunami on its way and traditional financial institutions better watch out..."

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