In a recently released memorandum, the IRS discussed the taxation of convertible virtual currency received in a crowdsourcing market.
According to the memorandum, convertible virtual currency is taxable as ordinary income if received in exchange for performing a microtask in a crowdsourcing platform.
The memorandum explained that crowdsourcing refers the ability to use the internet to outsource assignments or tasks to a group of individuals. In short, a person uses a platform and disseminates tasks to potential workers, who can then perform the task and submit the work (typically in exchange for a fee). Learn more.