IRS to Tax Bitcoins as Property

I don’t think it’s coincidental the IRS has deemed bitcoins to be property for it to be taxed as such. The federal government sees the cryptocurrency as a threat. It’s an attempt to thwart adoption of the virtual currency by political pull.

What this means is that practically every transaction would result in a capital gain or loss. Until there’s a program to automate the asset management valuation, the accounting paperwork would be overbearing. Each bitcoin, which is potentially divisible 100 million times, would have a different tax rate.