Jay Z and Beyoncé give Employees $6.4 mill in bonuses

[OnlyInCalifornia]

Yes it is better you clown.

Let's say the effective tax rate for a business is 50%.

If a business makes $100M and gives nothing away, they'd pay $50M in taxes and take home $50M. If they decide to give $10M to charity, then they're taxed on $90M, so they pay $45M in taxes and take home $45M...even though they pay less taxes they take home less money! The write off helps alleviate some of their tax burden, but it doesn't make giving away money better, financially, than just keeping.

Now, granted, we have a bracketed tax structure in this country, so the effective tax rate would also decrease, so they'd take home a little more than that $45M, but it would still be less than that $50M they'd take home by giving nothing away.

It is only better to give it away if they don't actually give it away or they write off expenses they'd incur even if there was no tax benefit.

No it fukking isnt and your apples to oranges example is comical. Especially considering Jay-z and Beyonce pay taxes in various states, where tax obligations are different, and factor in. Not to mention you seem to think it's a flat tax across the board and have no concept of how deducations/write offs work.

Why do you think you know better than businesses that do this on a regular basis?

 

[R.E.N. Spells Ren]

No it fukking isnt and your apples to oranges example is comical. Especially considering Jay-z and Beyonce pay taxes in various states, where tax obligations are different, and factor in. Not to mention you seem to think it's a flat tax across the board and have no concept of how deducations/write offs work.

Why do you think you know better than businesses that do this on a regular basis?

There's many reasons to give to charity, first and foremost to help the mission of those charities. But there's other benefits as well.
YOU don't understand why businesses do this. You don't give for tax benefits, you take tax benefits since you've given.

And I don't think we have a flat tax....I explicitly say as much in the post you quoted. The fact that this went over your head and your complete mis-use of the 'apples and oranges' idiom in addition to you thinking that paying taxes in multiple states has ANYTHING to do with this conversation suggests that you're not understand what's being discussed here. You're speaking out of your ass on a subject you do not fully understand.

 

[ArchStanton]

I wish someone would tell the business I work for that they can write-off an entire bonus if they gave me one... Since they've been cutting them down to next to nothing over the last six years or so, I'm guessing it's not as simple as all that.

 

[Harry B]

So you typed in 'writing off bonuses' and completely skipped the VERY FIRST LINK? I really am not sure if you are playing dumb or are dumb but that 400 dollar part you 'found' you clearly didn't read. That was in reference to physical gifts, such as a watch or a nice pen, not a bonus in the form of money. WHY? Because if you used your brain for a minute you would realize the government can tax a money bonus but can't properly tax an item given as a gift. Again, it is only spelled out for you on thousands of websites that bonuses can be written off as expenses. If businesses have reaped huge profits, they give out bonuses, and it lowers their tax obligation.

And clearly Jigga is not irrelevant to your life because you spend hours on this very website defending him. If you didn't care you wouldn't be playing games like you do. You do this in tons of Jay-z threads and the fact you are trying to pass it off like you don't, when people can search your profile, is asinine.

I don't know why you are so mad for someon asking you a question regarding bonuses and taxes.
And I don't know what you are talking about overall.

Now you've made me read mad links on a Saturday

I wondered if the whole bonus could be deducted and how it would go down, you got mad and started rambling about Jay-z for no reason.
Salaries are deducted as business expenses as well, it wasn't really what I was wonder. I was wondering about the technicalities. They first need to pay out 1.6 million in taxes for giving out 6.4 million. What will they deduct? 1.4 million?

Well this is not from ask.com or about.com or any other lazy site, most of this is from IRS official documents and the two last from Houston Chronicle breaking it down.

But the IRS points out that cash and cash equivalent fringe benefits, such as gift cards, charge cards or credit cards, are never excludable from employees' wages as de minimis benefits, regardless of the amount. So if you give your employees gift cards, the value of the cards would have to be included in the employees' wages as taxable compensation and reported on their W-2s.

Exclusion from wages. You can generally exclude the value of achievement awards you give to an employee from the employee's wages if their cost is not more than the amount you can deduct as a business expense for the year. The excludable annual amount is $1,600 ($400 for awards that are not “qualified plan awards”). See chap-ter 2 of Publication 535 for more information about the limit on deductions for employee achievement awards

http://www.irs.gov/pub/irs-pdf/p15b.pdf

This exclusion applies to the value of any tangible per-sonal property you give to an employee as an award for either length of service or safety achievement. The exclu-sion does not apply to awards of cash, cash equivalents, gift certificates, or other intangible property such as vacations, meals, lodging, tickets to theater or sporting events, stocks, bonds, and other securities. The award must meet the requirements for employee achievement awards discussed in chapter 2 of Publication 535, Busi-ness Expenses.

You can exclude the value of a de minimis benefit you provide to an employee from the employee's wages. A de minimis benefit is any property or service you provide to an employee that has so little value (taking into account how frequently you provide similar benefits to your em-ployees) that accounting for it would be unreasonable or administratively impracticable. Cash and cash equivalent fringe benefits (for example, use of gift card, charge card, or credit card), no matter how little, are never excludable as a de minimis benefit, except for occasional meal money or transportation fare.

When cash bonuses are paid to employees, they're generally deductible as wages if they're intended to serve as compensation for services rather than as a gift. The services, however, must be performed prior to the bonus payment. Despite being deductible and included on employee W-2s, the corporation will have to withhold income taxes and pay the employer portion of Social Security and Medicare taxes just as is done with regular wage and salary payments. The rules governing deductibility of employee wages require all amounts to be reasonable given the services performed. As a result, you'll need to look at the overall compensation, including bonuses, for each employee.

Assessing reasonableness is based on the facts and circumstances of each position and employee. Essentially, the total wage and bonus income the corporation gives an employee is reasonable if other employers would offer the same compensation package to the employee. Some of the factors to consider include the duties performed by the employee, the volume of business he's responsible for, time commitments, skill set, complexity of the work, and the bonuses and wages offered to other employees. For example, if you pay a janitor a $100,000 bonus – an amount that would likely shock most people – the IRS may find the amount unreasonable and nondeductible.

Gifts and achievement awards your corporation pays out to employees may seem like bonuses, but it's not always the case, and different tax rules apply. Annual deductions for achievement awards are limited to $400 for each employee. If, however, the corporation has a qualified plan in place – which is essentially a written policy outlining the procedures for paying out such awards – the annual deduction per employee increases to $1,600.

 

[bangbreh]

how many staff members does he need
why don't he go feed some hungry kids in less fortunate areas
fukk this guy.

 

[jfkennedy]

Good to see. I thought I read he also did this with his Roc Nation employees as well.

Wale's album didn't sell much, but at least he got this bonus to fall back on.

 

[dave]

can't be mad at hov

 

[MBwithadream]

Mr. Belafonte done put a battery in their back...


That tough love is often the most effective

 

[Harry B]

So you typed in 'writing off bonuses' and completely skipped the VERY FIRST LINK? I really am not sure if you are playing dumb or are dumb but that 400 dollar part you 'found' you clearly didn't read. That was in reference to physical gifts, such as a watch or a nice pen, not a bonus in the form of money. WHY? Because if you used your brain for a minute you would realize the government can tax a money bonus but can't properly tax an item given as a gift. Again, it is only spelled out for you on thousands of websites that bonuses can be written off as expenses. If businesses have reaped huge profits, they give out bonuses, and it lowers their tax obligation.

And clearly Jigga is not irrelevant to your life because you spend hours on this very website defending him. If you didn't care you wouldn't be playing games like you do. You do this in tons of Jay-z threads and the fact you are trying to pass it off like you don't, when people can search your profile, is asinine.

So...

You care to comment on the info I provided or not?
Since I'm not using my brain and you being a master of this shyt and all.

 

[iceberg_is_on_fire]

how many staff members does he need
why don't he go feed some hungry kids in less fortunate areas
fukk this guy.

Why can't their daddy's do it? Not his problem, he got his own kid.

 

[iceberg_is_on_fire]

Wale's album didn't sell much, but at least he got this bonus to fall back on.

I hope Bleek is still in the will somewhere.

 

[Pillowysoft83]

So you dudes just believe anything you hear/read. Especially when it comes from a shytty online gossip magazine,

"Sources say".....fukk outta here.

 

[H@LLOW]

Where you at nas?

 

[AkaDemiK]

good shyt

 

[Artificial Intelligence]

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