The IRS may dial up new rules that could cost you more in taxes if your employer gives you a cell phone.
The feds have proposed taxing 25% of business cell phone use as income.
That means someone who’s in a 28% tax bracket and whose work cell phone costs their company $1,000 a year would pay $70 more in federal income tax.
[…]
The IRS has had a law on the books regarding taxation of personal calls on business cell phones for two decades, but companies have rarely complied because of the difficulty of keeping such records.
[…]
One choice would be for employees to offer proof that they have a personal cell phone that they use during working hours. That would substantiate that the business cell phone was being used solely for work purposes.Another option being floated would allow companies to use a statistical sampling to figure out how much of their employees’ phone bills are for personal calls.
[…]
The IRS said it is awaiting responses to its proposals from the public.
Elections have consequences. When Obama said he wouldn’t raise taxes on “95% of Americans”, he meant he wouldn’t tax you DIRECTLY.
First Republikan non-sequitur of the day. Congratulations.
The day this happens is the day I turn in my cell phone to my boss. If my company is already paying $99 a month for an unlimited plan, how does a personal call affect anything again?
But if the company gives you a phone and pays for it, don’t THEY pay the tax as well? i’m so confused…
This is an idea whose time has come, but it doesn’t quite go far enough. 3G calls and data usage should be taxed as well – ideally on a sliding scale so the heaviest users (businesses, etc) pay the most. 4G network use needs a tax also. Thus ensuring a true end-to-end tax.
Typical big government program…which will produce unintended consequences. The number of phones will go down (i.e. consolidate landline, work, personal) and thus so will the telco’s revenue and taxes.
#7 Benji, please move to Europe if you are not already there.
Was Obama the President two decades ago when this law went on the books?
How time flies when you’re having so much fun!
I guess enforcing old tax laws somehow magically transforms them into new tax laws these days.
The right wing nuts are already making up more crap. This is NOT a new tax. It has been there since someone named REAGAN was the President. You do remember Reagan, the Republican god?
This is the IRS looking to apply the current law to those scufflaws that are cheating on their taxes. Of course, the unpatriotic wing nuts on right that don’t like to pay their fair share for running this country will complain about anything.
BTW, this same law applies if you drive a company car, are given lodging, use a company laptop, or anything else used for YOUR enjoyment. You have to pay taxes on your end of it as earned income.
# 9 acumen_123 “Was Obama the President two decades ago when this law went on the books?”
“The IRS may dial up new rules”
So, why doesn’t O’Mama” just tell them to forget it?
#10 Mr. Fusion “our fair share”, what the f is that? I’d like to live in a world where we don’t get taxed for every thing we do. Imagine a world where people are actually responsible for their own actions. I guess that’s hard for you, you’ve probably had your mouth on the government tit your whole life.
Just because someone doesn’t want to pay more taxes it does not make them a republican nut job. Lot’s of intelligent hard working people in the US are actually capable of making their own decisions and spending money appropriately.
Maybe you’d prefer we fill the country up with Octomoms and provide healthcare to any fucker than can wonder across the border. I’d prefer to focus on the well being of my own family.
People, it’s not rocket science:
To avoid all mobile phone hassles just use PREPAID.
# 12 killer duck said, “Just because someone doesn’t want to pay more taxes it does not make them a republican nut job.”
According to conFusion logic, the Founding Father were republican nut jobs. I guess that comes from being a descendant of Royalists who fled to Canada…
#11 Paddy
“So, why doesn’t O’Mama” just tell them to forget it?”
Good idea. Let’s see if that sort of thing works:
Paddy, please stop blaming everything bad that happens in the entire world on the new President.
OK, now all we gotta do is sit back and wait a few seconds to see what happens next…
# 15 acumen_123 said, “Paddy, please stop blaming everything bad that happens in the entire world on the new President.”
So, what he and his administration does is now the “whole world”? Why don’t you list out all the drugs you are currently taking…
#16 Paddy
“Why don’t you list out all the drugs you are currently taking…”
Ad hominem
An ad hominem argument, also known as argumentum ad hominem (Latin: “argument to the man”, “argument against the man”) consists of replying to an argument or factual claim by attacking or appealing to a characteristic or belief of the person making the argument or claim, rather than by addressing the substance of the argument or producing evidence against the claim.
The process of proving or disproving the claim is thereby subverted, and the argumentum ad hominem works to change the subject.
#10 Mr. Fusion, thank you, I was wondering where those taxes were coming from.
I understand the fed’s got a big debt to pay off and doesn’t want to let this source of income slide. Still, it’s chicken change. Cut pork barrel spending, reduce the military, … I can think of plenty of better and faster ways to reduce the debt.
# 17 acumen_123 said, “Ad hominem”
Umm, no. When a person makes a ridiculous, unfounded accusation (see your post) it calls into question the mental stability of the accuser…
Seriously, I have a separate cell phone of my own, since I don’t want the boss knowing anything about my personal life. So, I won’t be paying any of these taxes or I will turn in the company cell phone and tell them why.
Fusion, no this is new. Before, you had to pay taxes on personal use. Now the IRS is deciding that a certain percentage of use of company phones for each employee is for personal use. Under Clinton they decided that people will pay the same percentage of the bill as a tip whether they pay by credit card or cash.
So why not tax you for all the ‘personal browsing’ you do on your employer’s internet connection?
And tax you every time you flush your employer’s toilets? And tax you for every piece of trash you throw out at work instead of at home?
I mean, it’s like earned income!
dur.
#23 I’m sure they are working on these issues. I hope Obama reigns in the IRS and the tax felon who runs it.
# 6 – “But if the company gives you a phone and pays for it, don’t THEY pay the tax as well? i’m so confused…”
The IRS would treat the cost of the phone as if you were paid that amount of money. They would have payroll taxes such FICA held out of your check.
That is different then all the other taxes collected on cell phone services.
I’ve had to pay taxes on “not cash” compensation before.
They put a percentage on your W2 and you pay taxes on that.
No big deal.
It seems petty but in an earlier blog entry, we learned that we are talking thousands of dollars for use of these smart phones.
#13 for the win
Why should you pay taxes on the tether an employer likely *forces* on you?
And then you have to ‘prove’ that you own a cellphone to avoid the tax? I mean, what is the crossover between ‘job requires smartphone’ and ‘doesn’t own cellphone’?
And what if you buy burners? How difficult are they going to make the rules for that situation?
This is like having to prove your house has indoor plumbing.
So do I get a tax rebate for using my personal phone for work purposes as my iphone is way better than the Windows Mobile POS my work gives me???
Nobody takes a crap in a company-owned bathroom for business purposes, therefore that bathroom is for personal use. So its only fair that Uncle Sam get some compensation for your personal use of company property. And start keeping track of those personal emails and your web surfing too, so you can report them at tax time.
Geeze the right wing nuts sure don’t have much intelligence. Not one person against this tax has a reasonable argument.
So you don’t like to pay taxes. Big deal. If you are being taxed too heavily then write your Congressman.
If you think you can manage your money better than the government then go buy yourself an island somewhere and set up your own little kingdom.
If you think cell phones shouldn’t be taxed then tell your Congressman.
If you think the IRS should tax toilet use, then get a brain. That is mandated under OSHA.
If you think the law doesn’t apply to you, you better hire a lawyer. A good one. Simply because this Reagan era law also applies to you.
#32 Fusion:
So like, the default mode of gov’t is to tax everything, and it’s our job to get them not to do this?
I’d prefer it if they quit taxing necessities.
#33, brm,
Read the article. This is not something new. It is the use of cellphones, paid for by your employer, for PERSONAL use that is being taxed.
The same applies if your employer gives you a car to use, you still have to pay taxes on all personal use of that car. This NOT a new tax or new definition of a tax, it is merely being applied to those that previously thought they were above the law and never paid the tax as required.