So, agree…don’t argue about it, but take note of the disadvantage. And, before you just ship from the US to a tax haven, seek serious consultation as well. It is not as easy to be legally compliant as you may think. There are solutions, but I see magnitude being large before many gain.

Please post this law.

(Not how you interpret it).

Thanks.

The blog post was to point out the disadvantages that US domainers are at because of US tax law, when you compare other domainers who live in tax free countries.

There is no debate on how domains are treated for tax purposes.

The law is clear.

The post reflects the law.

The debate raging on the board regarding the tax treatment of the purchase price of domains is needless. This is not a matter of opinion. It is a matter of law.

Feel free to ignore the attorneys and accountants. Like Paul Keating said, “expensing domain names is a ticket to jail”. His quote, not mine.

Remember that the IRS is interested in Americans or foreigners with assets inside the USA.

Canadians (like me) have a whole other set of regulations to follow. Most noteably that taxation is based on RESIDENCY, not CITIZENSHIP like it is for Americans.

You are posting the opinions of two people, not actual law.

So accusing people of cheating is pretty lame.

Its becoming clearer why Frank stopped blogging.

I thought the accepted strategy for this was to hold the domains in an offshore company such as BVI, Cayman, Barbados etc. and then rent or lease the domain to a USA, Canadian, EU person or company to use and make monthly revenue both for the person or company and the offshore owner of the domain name.

That way the sale of the domain is separated from the income generation of the domain.

But I see a lot of comments that make me think that many people are handling this in different and, likely, less tax efficient ways.