Pay Your Taxes With Bitcoin: SnapCard Launches 'Pay the IRS' Service
Published on January 15, 2014 at 23:06 BST
Bitcoin-based shopping cart snapCard is expanding its offerings by launching a pay-the-IRS service for its customers.
“Tax services are truly relevant right now,” Ioannis Giannaros, one of snapCard's founders, told CoinDesk. “It’s going to be really cool.”
SnapCard users will be able to pay their taxes in bitcoin, and the company will process a USD transaction through a payment processor.
“Essentially, you fill out a form and you say how much you want to pay. Then, we invoice you.”
Tax Payment Processing With BTC
“There are payment processors that have partnered with the government already. What we’re essentially doing is [functioning as] a layer on top that accepts bitcoin,” said Giannaros.
The cost for the tax payment service is a 1.87% fee for the payment processor and a flat $10 charge from snapCard.
“We have a government payment processor, like a credit card processor, that we run the transaction through. That’s the nuts and bolts of it.”
The electronic methods of submitting owed taxes have consisted of an echeck or a credit card. Many credit card processors charge between 2-3% to make a tax payment using plastic.
“There’s a lot of attributes to the US dollar that make it monopolistic in the US, and one is paying taxes. You have to pay in dollars,” Giannaros said. “At the end of the day, you still pay in dollars through us. But it kind of alleviates the end-to-end point. It’s using bitcoin to pay your taxes.”
SnapCard and Ecommerce
SnapCard bills itself on its website as ‘the easiest way to buy anything on the Internet using bitcoin’. The company regularly charges a 2% fee (1% during the month of January) when using the shopping cart service to pay for items with bitcoin, and uses a bookmarklet to enable the checkout process.
Once a user gets to the shopping cart stage of an online purchase, he or she clicks on the snapCard bookmarklet, which forwards the data to the company for bitcoin processing. The advantage of this is that, with the exception of Overstock.com, large online retailers still don’t accept bitcoin as a payment method. Until that changes, those who want to buy items with BTC from Amazon or a majority of online retailers need to use a third-party service. SnapCard has even processed the sale of a $90,000 Mercedes Benz from a car dealership that would not accept BTC.
So far, snapCard has facilitated more than $300,000 in BTC transactions from an active base of over 2,500 users. In December, Giannaros and his co-founder Michael Dunworth told CoinDesk in an interview that they believed many of their customers were early bitcoin investors looking to spend their increasingly valuable bitcoins to promote the virtual currency.
SnapCard is currently being incubated at Boost VC, a San Mateo, CA-based startup accelerator that frequently financially backs bitcoin-based companies. A few other bitcoin startups along with snapCard will be pitching to investors at Boost’s Winter Class Demo Day on 11 February.
Tax payment image via Shutterstock
Coinbase Rolls Out Extensive Security Update
Canadian Realtor Accepts Bitcoin Deposits for Residential...