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More Tax Payments via Cryptocurrency are Coming

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Ohio made history in November 2018 when it became “the first state in the United States, and one of the first governments in the world, to accept cryptocurrency.” But its glory was short-lived, because Ohio stopped accepting cryptocurrency tax payments in October 2019. Colorado is now giving it a go as Gail Cole explains.

Apr 1st 2022
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Colorado is to become the latest state to accept crypticurrency for tax payments now, taking up the mantle.

During a February 2022 interview, Governor Jared Polis told CoinDesk that “Colorado will start accepting cryptocurrencies for tax and other payments to the state by the end of the summer.”

When asked how that would work, Polis said Colorado is looking for crypto companies to act as a transactional intermediary, to accept and convert cryptocurrency payments on behalf of the state. “Our budget is still in dollars. Our expenditures are still in dollars. And of course, we don’t want to take the speculative risk of holding crypto.” Payments would enter the state’s system as dollars, “but for consumer convenience we want to accept payment in a wide variety of cryptocurrencies just as we do in credit cards.” He also noted that “the transaction cost is a lot less for crypto” than it is for credit cards.

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I could find nothing about this on the Colorado Department of Revenue website, but according to Governor Polis, Colorado will start by accepting bitcoin and other cryptocurrencies for tax payments sometime during the summer of 2022. A few months after that, Colorado will accept cryptocurrencies for other transactions, such as payment for driver’s licenses and fishing licenses.

This is just one way Colorado is putting itself “at the center of the crypto economy,” said Polis. In 2019, the city of Denver used blockchain technology to facilitate voting for residents overseas. Colorado has its very own Blockchain Solution Architect. There’s even a project to “move the state’s cattle-brand system onto the blockchain,” though that seems a bit oxymoronic.

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