but i’m more surprised by wild expansion of the categories, not that it’s not material good (if transitory). Say i’m goods delivery driver, i take fuel and amortization as a bill main part (to be deducted later), my wage as a tip, wouldn’t i basically be golden tax wise? or hairdresser, same for rent/utilities and real work?
Business ownership in America is a way to avoid taxes and hide money, but you gotta actually recognize how to do it by looking at the math on the tax form or pay someone to do it for you (which fewer and fewer cpas will do anymore because a bunch of reasons) and not have goody two shoes brain.
The problem is that if you’re gonna push business ownership as the means to achieve class mobility then you need a lower class who will take advantage of those loopholes and we have spent billions of dollars educating kids to fear the carceral state and funneled anyone who can perform basic algebra into the stem -> engineering degree pipeline.
So there’s a massive amount of single entity llc havers who get befuddled by the math or stop at “boy, at least if I had a bunch of losses I’d be able to avoid taxes!”
So it also functions to give the dumb honest guys a break and trick otherwise perfectly functional soon to be Delaware corp havers into becoming dumb honest guys.
one man llc aside, can’t gig companies do billing shenanigans as well? “oh, your bill is split into two parts: 30% for our excellent work for finding you an uber driver and 70% tip”. Won’t help with fuel and whatever car miles, but still might significantly redistribute taxation load
They already do! Giggers (I see how that reads on a proof but leaving it in bc it’s apropos) are almost universally treated as contractors so there is a whole constellation of billing practices that can be applied even before anything that gets classified as a tip goes in the tax free bucket!
A tip from whomst, for example? Sure, you put ten bucks down as your tip to the driver, but the company puts its hand in the tip jar as well (famously, as documented in a bunch of lawsuits!). What percentage of your tip goes to the driver and what percentage goes to the company? Almost certainly it will be a floating range manipulated to incentivize people to work for less company outlay during the most profitable (for the company) times!
People in the gig economy are still gonna get screwed by this through a series of Byzantine rules.
Which is fine because the gig economy is the new service industry, the noob trap you should only be in if you know exactly and precisely why and what you’re doing.
There’s a cap that limits most of the shenanigans. Plus gig workers still have to pay self-employement tax and ss/Medicare tax on the tips. It’s just an income tax deduction
but i’m more surprised by wild expansion of the categories, not that it’s not material good (if transitory). Say i’m goods delivery driver, i take fuel and amortization as a bill main part (to be deducted later), my wage as a tip, wouldn’t i basically be golden tax wise? or hairdresser, same for rent/utilities and real work?
Yes that’s the other part.
Business ownership in America is a way to avoid taxes and hide money, but you gotta actually recognize how to do it by looking at the math on the tax form or pay someone to do it for you (which fewer and fewer cpas will do anymore because a bunch of reasons) and not have goody two shoes brain.
The problem is that if you’re gonna push business ownership as the means to achieve class mobility then you need a lower class who will take advantage of those loopholes and we have spent billions of dollars educating kids to fear the carceral state and funneled anyone who can perform basic algebra into the stem -> engineering degree pipeline.
So there’s a massive amount of single entity llc havers who get befuddled by the math or stop at “boy, at least if I had a bunch of losses I’d be able to avoid taxes!”
So it also functions to give the dumb honest guys a break and trick otherwise perfectly functional soon to be Delaware corp havers into becoming dumb honest guys.
one man llc aside, can’t gig companies do billing shenanigans as well? “oh, your bill is split into two parts: 30% for our excellent work for finding you an uber driver and 70% tip”. Won’t help with fuel and whatever car miles, but still might significantly redistribute taxation load
They already do! Giggers (I see how that reads on a proof but leaving it in bc it’s apropos) are almost universally treated as contractors so there is a whole constellation of billing practices that can be applied even before anything that gets classified as a tip goes in the tax free bucket!
A tip from whomst, for example? Sure, you put ten bucks down as your tip to the driver, but the company puts its hand in the tip jar as well (famously, as documented in a bunch of lawsuits!). What percentage of your tip goes to the driver and what percentage goes to the company? Almost certainly it will be a floating range manipulated to incentivize people to work for less company outlay during the most profitable (for the company) times!
People in the gig economy are still gonna get screwed by this through a series of Byzantine rules.
Which is fine because the gig economy is the new service industry, the noob trap you should only be in if you know exactly and precisely why and what you’re doing.
There’s a cap that limits most of the shenanigans. Plus gig workers still have to pay self-employement tax and ss/Medicare tax on the tips. It’s just an income tax deduction