Miscellaneous Uses for a Blog

While it’s been some time since I’ve spent a great deal of time in Second Life, I DO try to keep up with what is going on in-world.  News from Linden Labs (creators of Second Life) that they are stopping ALL gambling and gambling related activities in-world has sent waves through the Second Life community.  There are people that make a decent amount of money via running gambling spots. While I could care less if there was gambling in Second Life (outside of the fact that removing it also takes away 85% of the camping spots), it DOES create some concern.

Linden Labs has been fighting this battle with the FBI for some time now. Their arguement has always been that the Linden (the second life monetary unit) does not have any value.  This despite that one can exchange Lindens for actual US dollars. There are people in-world that make a real life living off of money they make in Second Life.  With Second Life conseeding the FBI and banning gambling, they are in essence admitting that the Linden has value. With that admission, it opens Pandora’s box to a whole host of other problems in the Second Life economy.

Next up, Uncle Sam 

If the Linden has value, then it can be taxed. If it can be taxed, it would need to be paid based off the seller’s state (as with most online sales). The question then becomes then WHERE and HOW? There has been talks for some time that taxes would likely be paid via the various Linden exchange markets.  LindEx, SLExchange, and the like. This would be the logical first step, but would ignore the in-state tax thought.  Taxes at that point would need to be paid off the declared state the exchange market resides.

If the Linden has value, what happens if I donate money to Relay for Life? Can I take this as a tax deduction? Do the organizers of RFL need to then maintain tax records for all the donations they get in-world? How about tips for music performers? Could those be treated as gift donations?

In the short term… 

It remains to be seen how the initial removal of gambling from Second Life will be taken by the community. I wouldn’t be suprised to have some sort of mass exodus from at least those that ran these casinos. I can already hear the virual screams complaining about the notion that gambling is bad, which will make even more people irate.  As was pointed out during Coffee With Crayon this morning, there will probably be a TON of inexpensive land out there for the land sharks to snatch up. The exchange rate for Lindens will probably change quite a bit. News reports will have yet another expose’ topic to do about Second Life.

Beyond the initial chaos, I’ll be curious to see how this intensifies the whole tax debate. Either way, the Second Life we know now will likely be somewhat different 6 months from now.