Re:The GOP Tax Plan Will Destroy Graduate Education
by theli0nheart on Tuesday November 07, 2017 @03:29PM
(#15647233)
From my brief assessment, it seems like tuition waivers are a form of barter. Other forms of bartering are taxable, so they're eliminating this exception.
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Re:The GOP Tax Plan Will Destroy Graduate Education
by derekp7 on Tuesday November 07, 2017 @03:50PM
(#15647478)
As for bartering being taxable, I wonder how employee-only discounts at retail establishments work? Is the discount amount taxable (or should it be taxable)? From my understanding of research tuition waivers, the PhD student is working for the university, and as an employee is getting a steep discount on the product (education) they normally sell.
Re:The GOP Tax Plan Will Destroy Graduate Education
by theli0nheart on Tuesday November 07, 2017 @04:07PM
(#15647655)
> As for bartering being taxable, I wonder how employee-only discounts at retail establishments work? Is the discount amount taxable (or should it be taxable)?
I just looked this up on the IRS Employer's Tax Guide to Fringe Benefits [1], and it looks like only discounts on products that are less than gross profit margin are income tax exempt. E.g, if you sell a Widget for $10 and make $2 profit on every sale, you can provide a $2 discount to the employee, and then deduct that $2 from the employee's wages.
Furthermore, employees that are 5% owners or that make more than $120,000 are unable to claim any employee discount deduction.
[1]: https://www.irs.gov/pub/irs-pdf/p15b.pdf (p10)