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Posted by Norm on April 9, 2008, 7:19 pm
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I had a client with a W2 that showed wages (box 1) of 1500 but social
wages (box 3) and medicare wages (box 9) each showing $9. There is
no explanation for the discrepancy. Client contacted the company and
was promptly told "You can ignore the W2. It's a lodging credit that
we report to the IRS."
Has anyone encountered a similar situation or could shed some light on
this?
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Posted by Harlan Lunsford on April 9, 2008, 8:06 pm
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Norm wrote:
> I had a client with a W2 that showed wages (box 1) of 1500 but social
> wages (box 3) and medicare wages (box 9) each showing $9. There is
> no explanation for the discrepancy. Client contacted the company and
> was promptly told "You can ignore the W2. It's a lodging credit that
> we report to the IRS."
>
> Has anyone encountered a similar situation or could shed some light on
> this?
>
IGNORE the W2? HAH! At your peril.
Reminds me of young fellow dropped in yesterday and when I asked about
other income, he confessed he had worked for local newspaper, but since
total was under 600$, they told him he didn't have to report it.
ChEAr$$$,
Harlan Lunsford, EA n LA
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<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by rlsusenet@NOSPAMPUHLEEZschnapp on April 10, 2008, 11:06 am
Please log in for more thread options Harlan Lunsford wrote:
> Reminds me of young fellow dropped in yesterday and when I asked about
> other income, he confessed he had worked for local newspaper, but since
> total was under 600$, they told him he didn't have to report it.
>
> ChEAr$$$,
> Harlan Lunsford, EA n LA
This is more the rule than the exception, I'm afraid. I participate in a
lot of broadcast stations' promotional programs, and run into lots of
fellow promo program addicts who fervently believe that if they don't
receive a 1099-MISC for their booty, they are under no obligation to pay
taxes on it.
Likewise, I know people who gamble recreationally. When their slot
machine wins exceed $1,200 (in any given payout), they receive a W-2G,
and they're very careful to subtract off their slot "contributions"
against the income. When their jackpots are below $1,200, they don't
get a W-2G, and they consider those winnings to be tax-free.
Sigh.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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Posted by pleasedontemailme on April 10, 2008, 11:34 am
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>I had a client with a W2 that showed wages (box 1) of 1500 but social
>wages (box 3) and medicare wages (box 9) each showing $9. There is
>no explanation for the discrepancy. Client contacted the company and
>was promptly told "You can ignore the W2. It's a lodging credit that
>we report to the IRS."
>Has anyone encountered a similar situation or could shed some light on
>this?
Well, I've certainly had plenty of clients with wages in box 1 and
zero under SS and Medicare wages. This happens with employees of the
school districts who elect out of SS in favor of the state teacher
retirement plan as well as certain college students working for the
institution they attend. I guess it's possible that the employee is
not normally subject to FICA and the lodging credit for some reason is
subject to FICA, or of course it's possible the employee is not
subject to FICA and the employer handled the lodging credit
incorrectly.
--
<< ------------------------------------------------------- >>
<< The foregoing was not intended or written to be used, >>
<< nor can it used, for the purpose of avoiding penalties >>
<< that may be imposed upon the taxpayer. >>
<< >>
<< The Charter and the Guidelines for submitting posts >>
<< to this newsgroup as well as our anti-spamming policy >>
<< are at www.asktax.org. >>
<< Copyright (2007) - All rights reserved. >>
<< ------------------------------------------------------- >>
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