Everything Is Income
Back when I took tax law in law school (I had to, I didn’t want to) I took from the class the one rule of taxes in this our United States – everything is income.
I was reminded of this by a news story that reported that the IRS is going after companies that provide cell phones for their employees. In the event you didn’t know it, if you make a call on your company cell phone for a personal purpose, you must report the value of the call as income.
My bet is that most of us don't report that "income."
Companies can avoid being hit for not reporting their employee’s personal use one of two ways. They can monitor the bills and file W-something-or-other on each employee for each phone call made. Or they can implement a plan that forbids their employees from using their company cellphone for personal calls.
If they mess up, the IRS is hitting the company for the taxes that should have been paid by the employees. Go after the easier target I guess.
4 comments:
GEEZ! You've got to be kidding -or rather, THEY'VE got to be kidding! No, I suppose not though as since you posted it here, I'll take your word for the accuracy. But does the IRS ever let up? Don't answer that, I already know what you'll say.
Yes, this will surely close the deficit. And it will be so easy to enforce, too.
Jeni NO the IRS never gives up.
I worked as a cosulting nurse for a time and had to list myself as a independant contractor. What a nightmare come tax time. I finally gave the job up cause I couldn't deal with all the expenses I had to itemize
My X is a big time Tax lawyer - he lives and breathes tax. His current mobile phone policy is interesting in that he pays a percentage of the bill and the company pays the other percentage. Each month the break it down by calls made. Now they break it down by calls received as well due to a change in Sprints statements.
Wouldn't it be easier just to have two phones in such a situation? I know other employers who just pay the package rate, no questions asked. They require a mobile and are willing to cover all costs. Not sure who they work the taxes.
Post a Comment