Michigan Virtual Currency Payments Are Taxable
- Sales Tax News
- Nov 6, 2015 | Gail Cole
Virtual currency such as bitcoin is not considered tangible personal property in Michigan and therefore sales of virtual currency are exempt. However, when virtual currency is used to pay for taxable goods or services, those transactions remain subject to sales tax.
Since the value of virtual currency fluctuates constantly, taxpayers who accept virtual currency as payment are required to maintain documentation demonstrating the value of the virtual currency at the exact time of the sales transaction.
Taxpayers may not pay sales and use tax in virtual currency.
Additional information is available in the Michigan Department of Treasury November 2015 Tax Policy Newsletter.