No More Free Meals For Tech Workers?

Megalith

Megalith

24-bit/48kHz
Staff member
Joined
Aug 20, 2006
Messages
13,000
One of the perks of working at a big tech company is free food, but it looks like that may come to an end if the IRS has their way and decides to start taxing meals.

Last year, the IRS suggested in its Priority Guidance Plan that it was exploring modifying sections of the Tax Code concerning employer-provided meals that it believed were problematic.
 
I can see both sides. On the one hand, it is effectively part of your salary. OTOH, you may not use it and more than that, its really a method to keep you from leaving work so that you'll work more, so it's not necessarily a perk. I know at lesser companies, it's a way to get you to work through lunch. I don't think I should be taxed on a 5 dollar lunch designed to get me to provide 20-40 dollars of work for that lunch.
 
Currently, free meals for employees, spouses and their dependents are excludable from income under section 119 of the Tax Code if the meals are for “employee convenience” and are provided on the employer's premises. The IRS is also looking to clarify section 132, which says an employee entitled under section 119 to exclude the value of a meal provided on the premises is treated as having paid an amount for such meal equal to the direct cost of the meal.

While the issue remains under review by the IRS, no changes are likely to be made anytime soon, said Evan Abrams, a tax attorney and a senior associate in Farella Braun + Martel's Family Wealth Group.

“Sometimes it takes years for (regulations) to be written,” Abrams said. “Even if it's a priority, it’s not clear anything will change overnight. Courts are more deferential to regulations; they would carry more weight than simply the guidance if they (IRS) do publish them.”
Click to expand...
May eventually happen to resolve the problem between the 2 sections of IRS code, but it's not happening any time soon.
 
I am not surprised as Obamacare taxes employers who provide too ggod(Cadillac) of a plan to their employees.
 
nilepez said:
I can see both sides. On the one hand, it is effectively part of your salary. OTOH, you may not use it and more than that, its really a method to keep you from leaving work so that you'll work more, so it's not necessarily a perk. I know at lesser companies, it's a way to get you to work through lunch. I don't think I should be taxed on a 5 dollar lunch designed to get me to provide 20-40 dollars of work for that lunch.
Click to expand...

My response to the whole "we're buying lunch so everyone can keep working" has and always will be, "fuck off, learn to schedule better, my sanity time is worth far more than the shitty cheap pizza you're going to buy".
 
I admit didn't read the article but this development is really interesting. I live in Las Vegas and worked casino/hotel most of my career. I'm in accounting/finance by the way. Vegas casino/hotels have had employee's dining rooms for eons, much more convenient for employee's that have limited ability and time to leave the property for lunch/dinner, etc. Wonder how this will affect the gaming world. Gotta love the IRS as they have also sent out feelers for establishing the reportable taxable jackpot to increase from the now $1,200 to only $600. Wonder if they implement that requirement if it will change players gambling behavior. Heck if anything due to inflation a taxable jackpot should be like $5,000. I heard someone at work mention that the reportable $1,200 jackpot amount has been around since like 1978 or some such with no change in the amount. I guess the feds are desperate for money.
 
And yet another reason to get rid of the income tax and also the IRS.

Replace it with a sales tax, exclude housing and packaged food (as that is the major expense for the poor), and apply a sales tax to everything else. Let the states collect it, keep 10% of what they collect for their troubles, and forward the rest to the federal government. Then eliminate 95% of the IRS, as you don't need much staff to collect 50 monthly checks.
 
kandrey89 said:
Problematic how???
Click to expand...

Read the article?

Currently, free meals for employees, spouses and their dependents are excludable from income under section 119 of the Tax Code if the meals are for “employee convenience” and are provided on the employer's premises.
...

Over the years, some courts have interpreted section 119 to apply in a situation like having someone work at a hotel's front desk overnight, where the employee can’t really leave if a hotel guest needs someone to check them in or out, Abrams said. In this case, meals might be provided to the employee but still for “convenience of the employer,” not necessarily the employee.

The crux of the debate is whether workers leaving their desks, grabbing a meal and returning is considered for the convenience of the employer or the employees.

“It’s gotten stretched,” Abrams said. “(Tech companies are) saying they need people always available because something could happen to the software. If they (the IRS) are really going to take a position, it would probably be for narrow situations like a doctor on call.”
Click to expand...
 
So will the IRS start taxing US military chow halls in the USA and abroad?
 
Dekoth-E- said:
My response to the whole "we're buying lunch so everyone can keep working" has and always will be, "fuck off, learn to schedule better, my sanity time is worth far more than the shitty cheap pizza you're going to buy".
Click to expand...

I agree, but if you've just done a big release, on a real time system, everyone pretty much has to work through lunch (and maybe dinner too). There's always bad planning, but even with good planning, you're probably not going to leave for lunch....the difference between the 2 is that with bad planning, you're not leaving for lunch this week (and maybe not next week).
 
nutzo said:
And yet another reason to get rid of the income tax and also the IRS.

Replace it with a sales tax, exclude housing and packaged food (as that is the major expense for the poor), and apply a sales tax to everything else. Let the states collect it, keep 10% of what they collect for their troubles, and forward the rest to the federal government. Then eliminate 95% of the IRS, as you don't need much staff to collect 50 monthly checks.
Click to expand...

Horrible idea. Sales tax disproportionately hurts those with lower income. If I make 90k today and 900k tomorrow I'm not going to spend 10x as much and if I don't spend 10x as more.

If you do that, it'll benefit me, but unless you're among the top wage earners, it'll hurt you. But if you are up for helping me, then let's eliminate taxes on investments and interest/dividends. I'd really like that too.
 
nilepez said:
Horrible idea. Sales tax disproportionately hurts those with lower income. If I make 90k today and 900k tomorrow I'm not going to spend 10x as much and if I don't spend 10x as more.

If you do that, it'll benefit me, but unless you're among the top wage earners, it'll hurt you. But if you are up for helping me, then let's eliminate taxes on investments and interest/dividends. I'd really like that too.
Click to expand...

There is already sales tax for pretty much everything everywhere.

Some states don't tax "necessities" such as food, but everything else is taxed.

Some states tax everything.

The IRS needs to die, plain and simple.

The "tax code" is so convoluted that is makes it a huge hassle and time/money waster for pretty much everybody.

Make it a simple flat rate for everybody. Having only a sales tax makes that super simple.

Prices probably wouldn't be affected much even if sales tax rates went up as there would be a huge savings from having no tax on anything else.

The way it is now, we are double, triple, quadruple.. and maybe even higher taxed for pretty much everything.

The goal of the IRS and the government is to steal as much money from as many people as possible without there being a revolt.
 
cyclone3d said:
There is already sales tax for pretty much everything everywhere.

Some states don't tax "necessities" such as food, but everything else is taxed.

Some states tax everything.

The IRS needs to die, plain and simple.

The "tax code" is so convoluted that is makes it a huge hassle and time/money waster for pretty much everybody.

Make it a simple flat rate for everybody. Having only a sales tax makes that super simple.

Prices probably wouldn't be affected much even if sales tax rates went up as there would be a huge savings from having no tax on anything else.

The way it is now, we are double, triple, quadruple.. and maybe even higher taxed for pretty much everything.

The goal of the IRS and the government is to steal as much money from as many people as possible without there being a revolt.
Click to expand...

Really? So if I make 15k/year you think that a sales tax is better than an income tax?

As for your sales tax stats, they're irrelevant. If you get rid of income tax, sales tax will rise around 17%, so in TX, our sales tax would be around 26%. I don't know about you, but when I was making 55-60k my effective rate was less than 20%.

If you make enough to benefit from a plan, you'd probably be better off spending your money on a better accountant.
 
Cod said:
So will the IRS start taxing US military chow halls in the USA and abroad?
Click to expand...

Don't forget the free clothes, rent they pay for by staying at the barracks, maybe even the rounds of ammo they fire!
 
sfsuphysics said:
Don't forget the free clothes, rent they pay for by staying at the barracks, maybe even the rounds of ammo they fire!
Click to expand...

Uniforms aren't free, it comes out of your pay.

Chow, uniforms, and staying in the barracks are listed in the service member's W2, so those things are taxed.
 
Nonono.

Next is a tax for the service of taxing you!
 
Wine said:
Uniforms aren't free, it comes out of your pay.

Chow, uniforms, and staying in the barracks are listed in the service member's W2, so those things are taxed.
Click to expand...

Seriously? Their food is a line item on a W2 form? What's an army meal cost as far as taxes is concerned?
 
Companies can either give out coupons with a minuscule value or sell the meals for a penny. The entire cafeteria could be spun off into it's own separate entity where it isn't even part of the company and exists solely as a standalone restaurant that just happens to deny access to the public.
 
I'm sure there's a democrat somewhere behind this brilliant idea.
 
nilepez said:
I agree, but if you've just done a big release, on a real time system, everyone pretty much has to work through lunch (and maybe dinner too). There's always bad planning, but even with good planning, you're probably not going to leave for lunch....the difference between the 2 is that with bad planning, you're not leaving for lunch this week (and maybe not next week).
Click to expand...

But it's not just bad companies which do this. The well known companies use it, as you stated, to keep employees tied to their desks. They give a bunch of other "perks" which are also designed to keep you an indentured servant at work.

That's why, even if the government taxes it, the major companies will still provide free food and other "perks". It's typically the younger individuals who can't see who they're selling their soul, but then again, that's why these tech companies have an average age barely out of college. Silicon Valley is notorious for the churn and burn workplace.
 
sfsuphysics said:
Seriously? Their food is a line item on a W2 form? What's an army meal cost as far as taxes is concerned?
Click to expand...

The amount that shows up varies depending on how often you go to the chow hall, you have your military ID swiped there and it logs how many times you get your meal at the chow hall, there is also some set amount when you are out on the ship and eating on mess deck.

Pretty much everything comes out of a service member's pay one way or another and is taxed.
 
Wasn't taxes already paid on the purchasing of food and the wages of the people preparing the food? This smell like triple taxation. This is what clowns get for voting Democrat.
 
LBJM said:
Wasn't taxes already paid on the purchasing of food and the wages of the people preparing the food? This smell like triple taxation. This is what clowns get for voting Democrat.
Click to expand...

So in your world if sales tax is paid when you purchase something for an employee (let's say a new car), there should be no income tax on that item? Oh and just in case, when the car was purchased, the car salesman paid taxes on his commission too.
 
You must log in or register to reply here.
Back
Top