Re: Taxes on Internet access prediction

At 4:07 AM 8/20/96, Mike McNally wrote:
>States and municipalities are taxing internet access.  Who wants to
>make a prediction about if/when the IRS will start to count net access
>as a taxable fringe benefit of employment?
>
>(At a small company where I once worked, a tax accountant visiting
>one day noticed that we had a weight bench set up in a back corner of
>the big "back room".  He advised us to be careful, because the IRS
>could count that as a taxable employee benefit.)

I think the test of whether something is a "perq" (or is it "perk"?), and
thus possibly taxable to the employee, is whether it is outside the normal
bounds of work. Thus, one's office cubicle, computer, office supplies,
etc., are not taxable fringe benefits.

Membership in a country club is, though.

Net access, if primarily used for work-related things, would not be. Just
as company phone calls are not treated as a fringe benefit for the
employees making the phone calls. Or business trips. And so on.

At least one community has tried to treat _parking places_ (and I don't
mean special, tree-shaded, reserved, V.I.P. parking places) as taxable
benefits. This is to try to get more people to car-pool, or telecommute, or
somesuch. Howls of protest pretty much drove this idea back into the hole
from whence it came.

Many of my Intel friends have Net accounts, obviously, and yet the number
of posts on the Usenet or elsewhere from "*.intel.com" are relatively low.
I asked a couple of friends of mine about this, and they confirmed that
Intel management has discouraged public postings and comments from
*.intel.com domain accounts. Understandable, for reasons I have discussed
many times. Many employees of companies find it easier to purchase their
own account from Netcom, Earthlink, Best, etc., and so have a Net name
unaffiliated with their employer.

--Tim May

Boycott "Big Brother Inside" software!
We got computers, we're tapping phone lines, we know that that ain't allowed.
---------:---------:---------:---------:---------:---------:---------:----
Timothy C. May              | Crypto Anarchy: encryption, digital money,
tcmay@got.net  408-728-0152 | anonymous networks, digital pseudonyms, zero
W.A.S.T.E.: Corralitos, CA  | knowledge, reputations, information markets,
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"National borders aren't even speed bumps on the information superhighway."

Timothy C. May wrote:
> 
> Net access, if primarily used for work-related things, would not be.
> Just as company phone calls are not treated as a fringe benefit for 
> the employees making the phone calls. Or business trips. And so on.

Sure, but clearly that's not exclusively the case.  (Amazingly enough
to some might be the fact that my for-work e-mail volume far exceeds
my not-for-work volume.)  Hopefully I haven't brought too much shame
to my employer.

In any case, with the IRS it's often less a matter of common sense
than what they happen to decide is The Law.  Witness the changes in
laws about what constitutes a "home office".  Currently, if you're
(let's say) a freelance plumber who maintains a legitimate office 
in your home, where nothing at all but plumbing-related stuff is
kept and plumbing-related work is done (booking jobs over the phone),
but most of your actual workday is spent out under people's sinks 
and most of your money is made out there in the field, then the 
IRS will not allow you to treat that home office as an expense.

(At least, that's my recollection of an NPR story from a year or
two ago.)

______c_________________________________________________________________
Mike M Nally * Tiv^H^H^H IBM * Austin TX * For the time being,
       m5@tivoli.com * m101@io.com       *    
      <URL:http://www.io.com/~m101>      * three heads and eight arms.