IRS Nails CPA For Copying Steve Jobs, Google Execs

theodp writes "It seems $1 salaries are only for super-wealthy tech execs. The WSJ reports that CPA David Watson incurred the wrath of the IRS by only paying himself $24,000 a year and declaring the rest of his take profit. It's a common tax-cutting maneuver that most computer consultants working through an S Corporation have probably considered. Unlike profit distributions, all salary is subject to a 2.9% Medicare tax and the first $106,800 is subject to a 12.4% Social Security tax (FICA). By reducing his salary, Watson didn't save any income taxes on the $379k in profit distributions he received in 2002 and 2003, but he did save nearly $20,000 in payroll taxes for the two years, the IRS argued, pegging Watson's true pay at $91,044 for each year. Judge Robert W. Pratt agreed that Watson's salary was too low, ruling that the CPA owed the extra tax plus interest and penalties. So why, you ask, don't members of the much-ballyhooed $1 Executive club like Steve Jobs, Larry Ellison, Sergey Brin, Larry Page, and Eric Schmidt get in hot water for their low-ball salaries? After all, how inequitable would it be if billionaires working full-time didn't have to kick in more than 15 cents into the Medicare and Social Security kitty? Sorry kids, the rich are different, and the New Global Elite have much better tax advisors than you!"

Comments

Why should the Rich pay Medicare and SS and EI?

[roman_mir]

Tell me something, do you honestly believe that the rich NEED the SS?

The rich need the EI?

The rich need the Medicare?

Anybody, do you think that Bill Gates needs to pay SS and EI and Medicare contributions?

Why?

I hear a lot of people argue that they are paying the SS and EI and thus they should get it back for some reason even though they are wrong, those are not insurance programs, where money is saved and invested and just sitting there invested, those are welfare programs, and the money are gone immediately to pay those on top of these pyramid scams, while the rest of the money is used to pay for whatever your politicians promised you, so you can't have your same dollar paid twice to you - once on some program/war and then the second time - to you, if you need SS/EI/Medicare etc. All of those programs are unfunded liabilities, they are all debt based, to 'fund' them US gov't must sell the US bonds first and that's debt. There is no money there.

But tell me something: WHY SHOULD ANY RICH PERSON PAY INTO SS?

By that same logic that people apply, when they argue that their SS payments are somehow actual insurance payments, by that very logic anybody who does not need to get any of that money because they have enough, shouldn't be paying into that pot. But it IS a scam, it IS a pyramid, this is NOT about insurance, this is about taking your money and buying a very expensive gov't, that does not do what you want, but does whatever it wants, that's why the richest people now are found in the government, in Senate, in House, in White House, even under the president's table sucking his cock.

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It is time for the sheeple to realize they are being scammed. It is time to stop paying all taxes to the US government and to revolt and take the government down or at least, it is time for the separate States to declare annulment of the federal government. Federal government is a cancer of the society, it is eating all of the lunch, it is printing all of the dollars.

You think Obama has lowered your taxes, right? But what about the gigantic, enormous tax of INFLATION? The Fed is printing the US dollar, inflating it away (it's also amusing to see how the US is complaining that China is manipulating currency, while it is simply trying to anchor their money to something, and is making a mistake of anchoring it against another currency rather than against gold. Many countries are anchoring their money against US dollar, the problem US has with China is that China also produces all of the goods that USA is consuming. It is in the best interest of China to no longer peg their currency to the US dollar and to appreciate their currency, but USA will be FUCKED. FUCKED. USA has no production capacity to supply itself with almost anything anymore, except for weapons of mass destruction.)

So do yourself a FAVOR, move all your money out of US dollar - this will help you to avoid the BIGGEST TAX that USA government is imposing on you.

Also realize, that the US gov't is the cause of all of the economic disasters and it's crashing the economy, destroying capital and jobs, and without productive jobs USA is fucked. However you can avoid the biggest tax of all - inflation - by moving your money into other flawed currencies or into something tangible - monetary metals or FOREIGN equities. That's right, foreign equities, not USA equities, because eventually the US gov't will be bailing out its monopolies and will be destroying competition completely but the companies that still will have some profit because they are catering to the foreign consumers will most likely be taxes more - windfall taxes, and you will NOT see your dividends.

You are robbed blind by your government, do something about it.

Stop giving it money, cut all spending by 99.9%. Fire all government workers. Stop all government contracts. Dismantle all government institutions and departments. Repeal all government laws.

All of this needs to stop and money must be made solid again, it must be