Ohio becomes the first state to accept Bitcoin for tax payments
Modernizing the Midwest to be more tech-friendlyBy Greg Synek 7 comments
Forward-looking: State Treasurer Josh Mandel believes that adding modern payment options for taxes can make Ohio more tech-friendly. Bitcoin can now be used by businesses to pay 23 types of taxes in the state.
Cryptocurrency has been viewed as an underground realm of opportunity for money laundering, drug sales, and other illicit activities, but that is not always the case. Ohio has become the first state to allow businesses to pay their taxes with cryptocurrency.
An online portal has been setup at OhioCrypto.com where businesses operating within the state can register. It is a simple matter of entering in a Tax ID number and then entering an amount and tax period for which the payment should be applied to. All payments are processed by BitPay, one of the better known third-party processors for cryptocurrencies.
In total, there are 23 different taxes that can be paid with Bitcoin. Currently, Bitcoin is the only cryptocurrency accepted, but the Treasurer's office "looks forward to adding more cryptocurrencies in the future."
At the time of payment, all crypto assets are immediately converted into US dollars before the funds are deposited into a state-held bank account. Businesses worried about volatility of Bitcoin are given 15 minutes to complete transactions at a fixed value. BitPay is responsible for absorbing any losses that could occur within the 15 minute payment window.
For an introductory period, there will be no transaction fees on crypto payments. Only the Bitcoin network fee and miner fees associated with all Bitcoin transactions will be paid by businesses. After three months, there will be a one percent fee, compared to the 2.5 percent fee on credit card payments. Direct payments from checking accounts can still be done without paying additional fees.
A fairly extensive list of questions and answers are available from Ohio's new crypto portal.