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Tax consequences of WIN95 team members keeping a piece of software for testing

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Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#81

Post by bonton89 »

rjst01 wrote: post #52
londons_explore wrote: post #40

Tax agencies don't go after air miles and other points schemes clearly designed to waste $$$'s of company money to get $ in their own pocket tax free. Considering that, I don't think they really care too much about a few engineers being allowed to keep loaner copies of software they used for testing.

The IRS decided in 2002 that taxing air miles was too difficult: https://www.irs.gov/pub/irs-drop/a-02-18.pdf , but I wonder if this might change in the future if airlines continue to shift towards programs that reward dollars spent rather than miles flown + ticket class. Some countries have specific legislation to exclude air miles.

I can understand not spending resources trying to focus on collection if it is to complicated, but coming right out and saying you aren't going to enforce it seems ill conceived. Wouldn't this promote the creation of more and more complicated schemes to allow for tax evasion?

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#82

Post by kazinator »

fransje26 wrote: post #41
bjornsing wrote: post #21

Earlier quoted context omitted.

This sounds surprisingly logical to me as a Swede. Here you can be taxed for income even if you didn’t receive anything at all. Take for instance a company office with a canteen exclusively for employees. Let’s say the canteen charges 20% under market price for a meal. In that case the employees can be taxed for having access to that canteen, even if they don’t eat there. This access is considered a taxable income.

> Let’s say the canteen charges 20% under market price for a meal. In that case the employees can be taxed for having access to that canteen, even if they don’t eat there. This access is considered a taxable income. I actually fail to see what is logical here. And I would go further by saying it is neither logical, nor fair. First the basic point. Why should an employee be taxed for a service he is not making use of.…

A company could fix the situation by implementing an access method for the canteen. Not necessarily a fob to get inside, but say, a card needed in order order the food there. At the end of the tax year, the company could issue a boilerplate letter to each employee who doesn't have the card for the canteen food discounts. For that matter, for each employee who has a card, their purchases could be detailed and the below-market-value saving tallied up for them to declare as tax. (Thus everyone could have a card and some could choose not to use it.)

The baseline assumption that everyone has access to the canteen and uses it is the company's fault for not implementing a more detailed system.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#83

Post by jalapenos »

lasereyes136 wrote: post #79
criddell wrote: post #61

The tax question I've always had is around conferences. If I attend a work-related conference in California, I'm being paid to be there and so that's California sourced income and I have to file taxes, right? During the pandemic when everybody was working from home, I thought about renting some place with more interesting scenery for a few weeks. I mentioned it to my bosses and was given a very short list of places w…

Ask a tax lawyer. My understanding, which is not legal or tax advice, is that, as a private person, you pay taxes in the state you have your primary residence in. There are a lot of rules around what it means to have a primary residence, so you need to check those.

Not that simple. Tax is levied based on source and residence. Employment income is "sourced" where it's exercised (where your body is as you're clicking that mouse and changing the coloured rectangles on your screen).

This is also unqualified non-advice.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#84

Post by toast0 »

criddell wrote: post #61

The tax question I've always had is around conferences. If I attend a work-related conference in California, I'm being paid to be there and so that's California sourced income and I have to file taxes, right? During the pandemic when everybody was working from home, I thought about renting some place with more interesting scenery for a few weeks. I mentioned it to my bosses and was given a very short list of places w…

Yes, work days while you're present in California are California source income. The California Franchise Tax Board has suggestions for how to apportion your employment compensation if it's not clearly obvious from hours etc.

I had thought there was a de minimis rule, so you need not report for a small number of days and a small income, but formalization of that policy was only proposed, not passed.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#85

Post by CoastalCoder »

cqqxo4zV46cp wrote: post #78
londons_explore wrote: post #62

Earlier quoted context omitted.

That announcement is really depressing. It isn't saying "airmiles aren't taxable". It says "we promise not to enforce laws about tax on airmiles". As a law abiding citizen, I now have a moral dilemma. Pay tax as the law says, or don't pay tax because the government promised not to punish me? Where will the latter lead? It's fine to do other crimes as long as you know the government usually won't prosecute? It's fine…

It’s not a moral dilemma. You are a just acting like an engineer looking for black and white answers in the face of real-world muddiness.

> It’s not a moral dilemma.

Perhaps it wasn't clearly articulated, but I see some moral dilemmas here.

1) Competing goods: obeying the law (civic virtue; collectivism) vs. personal happiness (hedonism; individualism).

2) Competing concepts of civic virtue regarding laws that won't be enforced: Is it better to (a) vigorously oppose such systems, because e.g. they lay the groundwork for tyranny, or (b) accept that some enforcement sloppiness is beneficial for various reasons, and should therefore be accepted?

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#86

Post by billy99k »

Are air miles taxed in the US? United airlines has a bug bounty program and they send you a 1099 for the miles and they say the points are valued a 2% of point value (you are taxed on this).

After calculating the point value and the amount I would pay for flights, I would actually pay more money in taxes than I would if I just paid for the flight myself, making the points mostly worthless.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#87

Post by hyperrail »

rswail wrote: post #23

In Australia, we have "Fringe Benefits Tax" which applies to that sort of thing. Basically anything that is considered a non-cash benefit is FBT tax owed by the employer. The tax is at the current maximum marginal income tax rate (47%) on a "grossed up" value of the benefit (currently 2.08). So $1000 of benefit is grossed up to $2080, then taxed at 47% so FBT of $977.60. Employer can deduct cost of the benefit ($1000…

Fringe benefits not specifically excepted are also taxable wage income in the United States, but I don't think employers are forced to gross them up at the highest marginal tax rate or are otherwise discouraged from giving them out in lieu of cash.

The USA's income tax agency, the Internal Revenue Service or IRS, has a whole booklet to help employers figure out how to withhold taxes for fringe benefits:

https://irs.gov/pub15b - Publication 15-B, Employer's Tax Guide to Fringe Benefits

It discusses the de minimis exception mentioned in the originally linked page, as well as exceptions for some meals - important if your employer gives you free or discounted cafeteria lunch or restaurant lunch discount coupons.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#88

Post by NoboruWataya »

bonton89 wrote: post #81
rjst01 wrote: post #52

Earlier quoted context omitted.

The IRS decided in 2002 that taxing air miles was too difficult: https://www.irs.gov/pub/irs-drop/a-02-18.pdf , but I wonder if this might change in the future if airlines continue to shift towards programs that reward dollars spent rather than miles flown + ticket class. Some countries have specific legislation to exclude air miles.

I can understand not spending resources trying to focus on collection if it is to complicated, but coming right out and saying you aren't going to enforce it seems ill conceived. Wouldn't this promote the creation of more and more complicated schemes to allow for tax evasion?

But quietly choosing not to enforce the law still leaves citizens in the dark about what they are supposed to do. It sounds like the IRS would like to be able to say "air miles are not taxable", but they probably don't have the legal power to amend or override whatever law it is that gives rise to the suggestion that they are. I'm not a US tax expert but I've seen other regulators take a similar approach.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#89

Post by lb1lf »

mrguyorama wrote: post #80
lb1lf wrote: post #39

Earlier quoted context omitted.

As do I, on a 166MHz MMX with a whopping 64MB of RAM. First computer I bought with my own money, pored over computer magazines for weeks to figure out how to get the best bang for my buck. Ended up with a Matrox Millenium 4MB graphics card with a 3dfx Voodoo on top, if memory serves. The budget was maxed out to the extent that the owner of the shop I purchased all the parts at agreed to drive me the two miles back to…

Why so much RAM? My Windows 95 computer had 32mb of RAM and even that was overkill.

It dual-booted into W95 or NT4 when I tried to do serious work. MatLab could suck up memory like you wouldn't believe.

Also, I think what made me pull the trigger was that RAM prices unexpectedly dropped by quite a lot just as I was about to buy, so I probably figured I might as well do a little future proofing.

Re: Tax consequences of WIN95 team members keeping a piece of software for testing

#90

Post by BuyMyBitcoins »

billy99k wrote: post #86

Are air miles taxed in the US? United airlines has a bug bounty program and they send you a 1099 for the miles and they say the points are valued a 2% of point value (you are taxed on this). After calculating the point value and the amount I would pay for flights, I would actually pay more money in taxes than I would if I just paid for the flight myself, making the points mostly worthless.

Credit card rewards on purchases are not taxable events. They are considered refunds/rebates by the IRS.

In this scenario United Airlines is compensating people for a service, so these airline miles are considered income. That is why they need to compute the dollar value of those miles in order to report the tax burden. This happens whenever someone is paid with something other than dollars, and when people barter.

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