Cryptocurrency has gained the whole world’s attention. So much so that some employers and their workers might be wondering if someone might be paid in Bitcoin for example.
In a recent article appearing on the workforce.com website, regular columnist, John Hyman, goes over this question in more detail. There certainly are legitimate online businesses that will accept Bitcoin as payment. These include Dell, Microsoft, Overstock, Expedia, Virgin Airlines, and even Subway. Of course, there are also some not-so-legitimate businesses, particularly those using ransomware and other shady characters that accept Bitcoin as payment, too!
According to Hyman, Bitcoin has proved to be a valuable asset and because it is being traded and accepted online, employers who are thinking ahead are wondering if it might be a good thing to explore being able to pay workers in bitcoin rather than just dollars and cents.
One caveat to be aware of is that the IRS does not view Bitcoin as currency, but rather regard it as property.
What does this mean?
It means that according to IRS guidelines and those set forth in the Fair Labor Standards Act, workers must be paid in cash or other instruments that are considered negotiable and at the same value as the same amount if it were in cash.
Other obstacles to paying workers in Bitcoin may include that if it is given to a worker as a bonus, be sure that such bonuses are not included as part of that worker’s regular pay rate. A way to avoid this pitfall is to ensure that a bonus of Bitcoin is considered a discretionary gift and would not be a part of any overtime or tied to any production or efficiency award.