Posted on 03/24/2009 11:14:14 AM PDT by Ramius
A little nugget that came up in a conversation with my Dad:
It’s been a while since I took tax accounting, but as I recall: You can’t “gift” away income in order to avoid the tax on it. No matter what you do with it, it is still *income*, and still taxable.
Isn't that swell... The AIG executives that have returned their bonuses—still have to pay the tax on them anyway.
What do you suppose congress will do about *that*?
LOL. What a comedy of errors this has become.
Pingaroonie... :-)
oops. And the circus continues.
Now THAT would be Hilarious since I’ll bet MOST of them VOTED for Obama and the rest of the Democrats!!
Not sure you’re using the proper analogy. If the money is returned it means it’s been rejected; not given as a gift. One cannot tax income that’s been rejected, as far as I know.
Take a corporation facing hard times. It presents a wage increase to an employee. That employee rejects the increase to help the business. Is he then taxable for that non-existent additional income?
Aww, they’ll likely just give it the “tim geithner” treatment...
Good catch.
You could if the recipient of the gift was a not-for-profit, charitable entity. In this case, AIG certainly isn't.
What's more interesting, is that I'm sure these men and women are keenly aware of that fact. It's their job after all.
This is a fairly well-known principle of tax liability, and yet, I haven't seen it mentioned anywhere, by any media outlet. It begs the question, are they that stupid, or are they just supporting a political narrative in which they believe so deeply.
Since it was received in 2009, it would be next year before
it would show up on their tax records anyway.
By then they hope all would have blown over.
Of course they are, they received the compensation, it was there choice in how they dispose of it.. Now, for example, one regional manager gets a $1Million bonus, then gives it back, he still has to pay $900k in taxes...
A comedy of errors is right.. just wait until Big Brother decides he doesn't like what business you are in..
Otherwise it's hearsay.
If the funds have already been deposited, can you reject them and not have them count as income?
A bonus isn’t considered income.
And then the recipient of the give-back will have to pay gift tax . . .
A bonus isn’t considered income.
They were always considered income...where I’ve worked.
pingarooney
Wouldn’t they have to pay tax twice anyway? First the 90% tax, and their AGI at the end of the year would reflect their bonus which would result in the income getting taxed again, in which case, if the money wasn’t returned, they wouldn’t have income to pay for the second tax. Unless they are allowed to claim exemption on the bonuses because they were already taxed, but then you would hear of public outrage about the AIG execs getting exemptions on their bonuses (even though they already have been taxed)
Not sure where I was going with that...
Does that matter? If they're returned to the giver and no realization of profit has been realized, can they really be counted as income?
If i was them I would not give the governemtn one single dime
I think this 90% tax will never be implemented, and unless I was worried about the NY Attorney Generals EXTORTION threat to release my name to the public, I would tell them to go F*** them selves.
Not only did they not do anything illegal, the DEMOCRAPS IN CONGRESS specifically ADDED WORDING IN THE LEGISLATION TO SAVE THESE BONUSES
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