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Strategies & Market Trends : The Residential Real Estate Crash Index
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To: GraceZ who wrote (51527)4/6/2006 1:49:33 PM
From: ChanceIsRead Replies (2) of 306849
 
>>>In the absence of performing ANY services that person is not a legal employee and paying them is not a deductible expense for his biz.<<<

Ok. Thanks. I guess that makes sense.

On the other hand, one might say that what is a tax avoiding deduction for the business, ends up as taxable income for the employee, and the IRS would get its cut either way. If you pay someone $15K, there clearly won't be as much $$$$ going to the IRS from the income tax as from the tax on the business net.

Of course I would argue that having mom on the payroll to avoid taxes to the IRS is providing a very valuable service to the business, even if more widgets aren't going out the door as a result of having mom around.
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