Tesla Is Now Accepting Bitcoin Payments For Vehicles in the U.S.

While many of us in the deep south were asleep a few nights ago, Elon Musk shared the big news on Twitter that you can now purchase a Tesla with Bitcoin. In the thread, Elon said that Tesla is using only internal and open source software and operated Bitcoin nodes directly. Bitcoin paid to Tesla will be retained as Bitcoin and not converted into fiat currency.

For those wondering what that means, fiat money is a government-issued currency that is not backed by a physical commodity such as gold but instead is backed by the government that issued it.  In other words, Tesla will not be converting its Bitcoin payments into any type of currency–for example dollars. If you want to cash out your Bitcoin, you would go to an exchange and convert your balance into whatever currency you use.

And right now, this new feature only available in the U.S. but later this year it may be available worldwide. Lex Fridman noted that Autopilot is now on the blockchain and Elon commented a thumbs up. This is actually pretty cool, honestly.

Tesla even has a special page on its website dedicated to the new Bitcoin as a payment acceptance.

It answers questions such as how one could pay with Bitcoin or how long will it take to process the payment. Tesla noted that you can indicate the payment from your Bitcoin wallet and either scan Tesla’s QR Code or copy and paste its Bitcoin address and the exact amount in your wallet. If you accidently sent the wrong amount–under the total cost, Tesla could cancel the order. Once you have sent your Bitcoin payment to Tesla’s wallet, Tesla will email you a confirmation and it can take up to six hours to process the payment once it receives it.

Tesla pointed out that once you send them the payment, the webpage should automatically refresh within one minute and if it doesn’t, then do not send a new payment. Just check your email.

Taxes, Tesla, and Bitcoin–A Love Triangle

CNBC noted that if you do decide to purchase a Tesla with Bitcoin, then it could mean a tax bill. The article noted that the IRS treats Bitcoin and another crypto as property. This means that when it’s sold, traded, or disposed of–even being used to buy things–it’s a taxable event. The amount you would owe would depend on how long you’ve held the Bitcoin and how much of a gain is generated.

The article interviewed Garret Watson, a senior policy analyst as the Tax Foundation. “It’s really important to know the cost basis of any cryptocurrency — the value when you bought it — and the timing of that,” Watson said. “That’s going to determine how much is subject to tax and what tax rate you’re paying.”

However, you pay taxes for anything so if you want to buy a Tesla with Bitcoin, don’t let that stop you–just make sure you have enough to cover the taxes and you’ll be fine. However, Tesla warns you on its site to be super cautious when sending Bitcoin. Make sure it’s the exact amount and only Bitcoin. If you send Tesla some Doge or any other cryptocurrency other than Bitcoin, you’re likely to lose that Doge, and Tesla may never receive it.

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