work in SL? IRS Says you must get MINWAGE

The Onion is more reliable.

In the U.S., employee vs independent contractor for IRS puposes is determined by a series of tests, ie, does the person supply their own tools, does the work require independent judgement, do they set their own hours of work, and on and on and on. It's a very sticky area, and RL employers often make mistakes in classification. The IRS has also been tightening the rules over the past several years...

Ah that makes sense Allegria, sounds like a means to stop employers circumventing laws by classing everyone as a contractor.

The IRS doesn't enforce minimum wage regulations, but they do decide whether someone is an employee or a contractor, which determines who pays the FICA taxes.

Indeed, if you look at the article at the SL Herald, that's what it was really about. The remark about minimum wage came from one of the comments to the article - suggesting that the original poster of this thread was at best careless in reading the article and reporting on it here.

All of the remarks about whether people are paid in Lindens or dollars seem to be made out of whole cloth. That issue is at most only indirectly relevant. While the article isn't specific, it suggests some employee of ESC filed an SS-8 with the IRS, which is a formal request for the IRS to decide whether an individual is an employee or contractor. I'll speculate that the person received a 1099-MISC from ESC and was annoyed at having to pay the self-employment tax. However, it's perfectly possible for an employer to pay someone in Lindens and nevertheless file a 1099-MISC in a dollar amount.

can someone explain how volunteering for something makes you eligible for pay?

It doesn't.

This is just the usual "let's extrapolate some change onto all sort of other things without thinking about it or getting the details" type of nonsense that happens all the time in forums. It's very loosely analogous to the suggestion that Linden Labs would sue us for posting a forum note saying "I participate in Second Life" instead of "I participate in the Second Life brand virtual world."

the irs or anyone in the world can't mess with you if you make lindens or not..only if you make dollars or income..until it hits your bank it's nothing more than a linden..not everyone takes money out..if they are gonna tax us on a linden then i'm getting my rightoffs for buying so many lol

Just to be clear:

I have yet to see anyone allege that the IRS has issued any sort of decision on the issue of inworld transactions, not even a Private Letter Ruling (which is binding on the IRS for a single individual but doesn't set precedent). That doesn't mean it hasn't happened, just that I personally haven't come across it, and I don't claim to read every note posted in these forums.

This is unlike your assertion about getting something in writing from a government minister for the UK. And I'm pretty sure I've seen such assertions before concerning a country or countries other than the US, though for all I know, I could just be remembering a previous note by you saying the same thing.

They most certainly can if they decide to. As far as I know, it hasn't happened yet, but it could. Under US law, barter income is still income subject to taxation.

There's been a fair bit of debate about it, not just here but also among tax scholars. Don't hold your breath for an official decision, but don't bet the farm on it going one way or the other, either.

thats just the silliest thing i ever heard of.so now they are gonna try and tax us on something that is not legit money until it goes out of game?if i make money in the game and buy clothes with it how can they tax me on that?
i'm playing a game..they can tax the store owner if they are using it as income but if it is not income you cannot be taxed on it.
i would think they would set up something where it is out of game..if it stays in game it is an investment anyways..you can't get hit on money that is in an investment until you pull it out..tax shelters..like a home or ira..we just all have to play till we are 65 hahahahaha

Yup and just to be clear the word "yet" was used and it only covered VAT. The tax man is a sneaky twisty beast and could declare inworld income has value tomorrow.

well if they do they better get ready for some major writeoffs..i have all my reciepts ready for the next tax season and i'll come at them hard hahahahaha
where there is tax there is money to be made!!

I didn't say there were going to. I said they could. You just tossed out a bunch of issues, but haven't presented a cogent argument as to why they couldn't.

See, for example, http://www.news.com/2100-1043_3-6140298.html , if you don't believe me.

That is just a pretend newspaper, right?

well really they are already taxing people that make money in the U.S..if you are making a living off of sl or income you have to report your income..that is if they are being good tax payers and reporting their income hehehehe..so they are gonna tax them twice?
i guess i am just more confussed as to how they could rather than they couldn't do it..they are ruthless and i am sure would love to tax us 4 times on the dollar besides the three times they are now hehehe

and let me be clear that i am not arguing with you at all..i am just shocked that i am shocked at the irs and how a subcontractor for the government can have so much power and there is nothing we can do about it..

It is more to put more people under mandatory payroll deduction for taxes. Don't think it is to protect the workers, it is purely a socialist scheme to get more money for the government.

Well, that's one take on it. Contractors are required to pay self-employment taxes, too. If a worker is classified as an employee, then 1/2 of the taxes are paid by the employer, rather than 100% by the contractor.

Yes, but they pay 4 times a year, if they pay at all. Much nicer for the Feds to take a little out of each paycheck. Keeps the sheep in the dark as to how much they are actually paying if it comes out a little at a time before they ever see it versus having to write a big check every 3 months.

Ah Chris I live in Europe, I know all about socialist taxes, I also know my taxes would be lower if capitalists weren't paying advisors on ways to avoid paying taxes.

More power to them. Maybe you should do the same.

Worse.. a pretend blahg.

Err no, I'm opposed to the poorest sections of society having to pay increased taxes. If everyone paid their dues we'd all pay lower taxes.

So.... what happens when a business in SL whose primary owner is an American citizen living in Virginia (minimum wage of $5.85/hr) hires a "greeter" working from her home in say California(minimum wage of $8.00/hr) ? Which state's minimum wage would be paid?

What if the American business owner hires only people who work from their home in the UK or France? Is the business owner still expected to pay the minimum wages of the state they live it?

What if I'm an American hired by a person living in the UK as a "greeter" at their club? Am I still expecting to make the minimum wage for my state from someone outside of my country?

God I hate how stupidly money hungry the IRS is.

If you pay taxes all your doing is giveing cash to some gready politican so they can have killer vacations and great houses most of that tax money never goes to what it should

sometimes, I really loathe the fact that I'm at best, self employed, and at worst, "a contractor" when working in a collab project.

If I could pull actual minimum wage for the time I spend in SL...

God, I could afford food.