Question about a potentional tax write off?

Brooke Wilde's Avatar
I own a small car wash, less then 20 employees, and I'd like to go ahead and give all my employees that were scheduled to work this week, yet missed work because of the storm, the full pay check they were expecting before missing all those hours ...

My question is: is this tax deductible for me? Is this considered a gift? What is the best way to do this so I am able to help them, while minimizing my out of pocket costs?

Should I just print their checks as usual for an 80 hour, 2 week period, with all the deductions?

Or should I give them this money in a separate check with no deductions?

Please excuse me for my ignorance, I really have no idea how this works. I do have payroll software, but nothing like this is mentioned in the FAQ's. I'd normally give my tax guy a buzz and ask him, however his office took a pretty serious hit so I figured I'd see if someone here could give me a quick answer.

Thanks!
Cut checks as usual with deductions and all that.
If you get caught plead ignorance- how does the government know that you gave them time off?

As always get a CPA to ask questions
DoubleEagle's Avatar
Email sent ma'am.
pyramider's Avatar
Posting taint photos will help to answer this question.
TryWeakly's Avatar
Maybe a wet TShirt would be more appropriate...
BeeDub....did you get your answer?
Pay it as normal, record it as payroll. It's a straight expense to the business regardless.
Brooke Wilde's Avatar
Sorry I was not able to reply yesterday.

I guess I didn't really word my question correctly, I was hoping that I could just give my employees a cash (or check - I don't have a preference) gift and then have that total subtracted from my 2017 tax bill .... Is that possible or do tax deductible donations only apply when you are donating to a non-profit?

It seems that if I just cut them a standard paycheck, that that will pretty much eliminate any tax write off I may possibly have.
nu2's Avatar
  • nu2
  • 08-31-2017, 06:53 PM
Gifts are only for a QUALIFIED charitable organization.

It is Publication 526 on IRS.gov (if you are filing for a business)

Charitable Contributions.

Try using the Interactive Tax Assistant on the IRS.gov web page. It is pretty good. It guides you through the process of filing your taxes for you particular situation. Hope this helps.
Brooke Wilde's Avatar
Gifts are only for a QUALIFIED charitable organization.

It is Publication 526 on IRS.gov (if you are filing for a business)

Charitable Contributions.

Try using the Interactive Tax Assistant on the IRS.gov web page. It is pretty good. It guides you through the process of filing your taxes for you particular situation. Hope this helps. Originally Posted by nu2
Ahhhhh, yes, that's what I figured.

I thought maybe there would be some type of exception/tax break for employers that were helping out their employees during a natural disaster, but didn't know for sure and I figured it wouldn't hurt to ask.

Also, I appreciate the info on the Interactive Tax Assistant. I had not heard of that before.
....

It seems that if I just cut them a standard paycheck, that that will pretty much eliminate any tax write off I may possibly have. Originally Posted by Brooke Wilde
A paycheck to them is already a tax write off to the business.

But you might check into a "bonus" payment instead of labor as maybe less payroll tax is paid. But it likely just turns out to be a wash for everyone. Income for them is income....and your payroll is already a credible deduction.