The thinking, optimizing, deciding — is beginning to be done not by humans, but by machines working faster and more scalably than any HR department can support. The nature of capital changes. If AI is the new workforce, then compute is the new payroll. Entrepreneurs have a smarter way to hold value. A compute-denominated token not only locks in future performance — it opens up elegant tax advantages, especially for startups.
This blog post doesn't constitute tax or financial advice; it merely describes our best understanding of the situation. Your best bet at isolating the appropriate strategy for your unique situation is a tax accountant or a tax/corporate lawyer. If you'd like to talk to us about it, please reach out.
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United States of America
In simple terms, if you know you'll be consuming inference, Melange is the preferred medium to retain significant sums of capital in. Melange is a utility token; when you acquire it, you are prepaying for a particular service and/or commodity i.e. inference. Tax-wise, this has a number of implications:
- Immediate deduction for cash-basis firms: If you acquire Melange in a given financial year and the inference you buy will be consumed within the next 12 months, the "12-month rule" lets you expense the entire outlay now rather than ratably over time. That pushes taxable income — and thus federal tax — down in the current financial year. What happens if you sell the token on the open market and don't use some portion of your allocation? You forfeit the deduction on the unused portion because you didn't "incur" the expense in substance.
- Near-term deduction for accrual-basis firms: Ordinarily you must wait until "economic performance" occurs (when the compute is actually delivered). But once you’ve fixed the liability and paid for it, the § 461 recurring-item exception deems economic performance to have happened by year-end so long as the services will be rendered within 8½ months. That accelerates the deduction into the year of pre-payment.
- Token mechanics add an extra lever: The IRS still treats utility tokens as property, not currency. Paying your provider with the token gives you an ordinary business deduction equal to the token's fair — market value on the payment date; if the token’s value hasn’t moved since you acquired it, no gain arises. In practice, buying and spending the token in short order lets you capture the deduction without triggering a taxable crypto gain or loss.
- R&D sweet-spot from 2025 onward: Compute bought to develop or fine-tune models usually qualifies as domestic R&D under the newly enacted § 174A rules. Starting with tax years after 31 Dec 2024 you may expense those costs immediately instead of amortising over five years, stacking an R&D deduction on top of the timing benefits above.
- State and local quirks: Many states exempt intangible property from sales/use tax. Because you’re transferring a digital token rather than purchasing a "cloud service" licence outright, the transaction often slips outside state sales-tax nets, trimming the all-in cost of compute. (Check your state rules.)
Prepaying with a compute-pegged token turns tomorrow’s compute bills into today's deductible expenses, front-loads any R&D write-off, and may dodge ancillary sales-tax friction—all while letting you lock in compute at a known price. Coordinate the purchase-and-spend dates to keep crypto gain neutral, elect the recurring-item exception if you’re on accrual, and you've shifted cash outflow and tax relief into the same year — an old merchant's trick, perfected for the silicon age.
References
United States of America
- IRS Publication 538 (Rev. January 2022): Accounting Periods and Methods, Department of the Treasury, Internal Revenue Service, February 14, 2022.
- 26 CFR § 1.461-4 - Economic performance. Electronic Code of Federal Regulations.
- "Section 174 Repeal: R&E Expensing in 2025" – Cherry Bekaert, July 2025
- Internal Revenue Service. (2014). Notice 2014-21: IRS Virtual Currency Guidance.