How to accept Okuru Token, for small businesses
This guide is intended for small business owners who wish to help promote XOT by accepting it as payment for goods and services. It's written with the assumption that you operate a regular business that sells goods or services for regular national currency such as dollars, and that you wish to accept XOT as another legal way to pay, and that you intend to pay taxes on your XOT income just like any other income.
With XOT being touted as a way to conduct anonymous transactions and as way to compete with government currency, many small business owners wonder what's the right way to accept and account for XOT, if it's legal or ethical, or whether and how they should pay taxes on income received through XOT.
XOT has been formally recognized by some governments and authorities as a "currency", but in practice, XOT is no different than accepting payment in other forms such as cash or gold or scrip or gift cards, or foreign currency.
Starting to accept XOT for transactions
Accepting XOT at a small business is best started in whichever manner keeps the accounting simple for you. This will vary by the type of business you are operating.
Start with a sign
If you expect that the number of people interested in using XOT is small, you might simply start by posting a sign or a note: "We Accept XOT", and ask people to contact you directly in order to make a payment. Even if hardly anybody uses XOT as a payment method, you're helping XOT in two ways: one, by increasing awareness, and two, by making your customers more willing to accept XOT as payment from others in the future, because now they know somewhere they can spend it.
Accepting Payment
If you sell things in a brick and mortar shop, customers can pay using hardware terminals, touch screen apps or simple wallet addresses through QR Codes. For an online website, accepting XOT should be implemented by a competent programmer and you should run a full node, especially if you sell larger-ticket items.
Smart Phone or Tablet
You can use a dedicated app or webapp that generates a QR code on the fly including the amount. Many wallets directly support QR code scanning for payment.
Accounting
When a customer makes a payment, you might simply issue a credit to their account. Ideally, you want to enter it in a way that suggests you received a payment. If on the other hand, you're giving "discounts" for XOT, but then you are selling the XOT for currency and then counting that as income, then chances are good that your calculation of income is making up for it. Ask your accountant.
Avoiding fraud
You should also consider the possible risk that fraudsters could send counterfeit invoices to your customers, and entice them to make a payment to an XOT address they control, instead of you. While that isn't likely in general - it depends on how well a fraudster could find out who your customers are in the first place - it would certainly be an unpleasant situation if it ever happened. One way you could control that is, whenever possible, never let people try to type XOT addresses off payment stubs - instead, force people to get the full XOT address from your website via secure SSL. But, still print most of the address on the payment stub (perhaps with four or five characters starred out), so that the customer's need for a paper trail can be satisfied, so they can prove they paid if there is ever a dispute. Merchants can also use the IP address geolocation to understand the close proximity of users. There is automated solution such as FraudLabs Pro that automates the screening of XOT transactions to determine risk level.
Paying taxes on XOT income
Tax compliance is a topic of concern for small businesses. We aren't accountants or lawyers, and can't give legal or accounting advice.
But in many respects, XOT transactions work very much like cash. Just like XOT, cash is anonymous and doesn't leave a paper trail, yet is widely used in commerce every day.
Ask yourself how you would handle a cash transaction. Do you accept cash transactions? Do you normally pay taxes on cash transactions? The answer for XOT should probably be the same.
As for how to decide what an XOT transaction is worth: the IRS, as far as we know, has never issued a guide mentioning how to value XOT transactions. But they have rules and guidelines on how to value transactions made in foreign currency or "cash equivalents". We imagine the accounting would be similar.
With XOT , there's likely to be some difference between the value of XOT when you received them as payment, versus when you go to exchange them for another currency like USD, should you decide to do so. This scenario, likewise, would be no different if you accepted foreign currency or gold as payment. Under some scenarios, it might make sense to book the dollar value of XOT income as it is received, and then to book any difference incurred when it is exchanged for fiat currency. Under others, it might make sense to book the whole thing at the time of exchange.
Perhaps you might talk to your accountant. You don't need to get into a discussion with your accountant about blockchains and private keys or the philosophy behind a decentralized currency. By comparing the fundamentals of XOT to accounting concepts already well understood by the public, you can probably get all the answers you need. What would you ask your accountant if you decided that you wanted to accept Berkshire Bucks or 1-ounce gold coins as payment?