Tax

Have a Tax Question? Ask a Tax Expert

Ask an Expert,
Get an Answer ASAP!

Tax

Can an outside director ask that his directors fee be ...

Customer Question
Can an outside director ask...
Can an outside director ask that his director''s fee be paid to his employer so that it will not be counted as personal income to him?
Submitted: 9 years ago.Category: Tax
Show More
Show Less
Ask Your Own Tax Question
Answered in 20 minutes by:
5/2/2008
Tax Professional: RD, Certified Public Accountant (CPA) replied 9 years ago
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
Verified

Did the company engage the services of the director directly or did it employ the services of the employer who than assigned the director for the job?

 

Ask Your Own Tax Question
Customer reply replied 9 years ago
Reply to RD's Post: If I understand your question correctly, the employer assigned the director - the director was not selected individually.

The facts of the situation are basically - 4 corporations are joint investors in another company. Each of the 4 corporations appoints a director to the joint company. The directors receive compensation for their service on the board, but one director does not want the tax consequence of the director's fees being counted as personal income to him. He would like to have his director's fees paid directly to the corporation he represents so that these fees would not be counted as personal income to him. He wants it counted as income to the corporation he represents instead. Can he do this? If so, how? Would a simple letter to the joint company asking that any compensation for his service on the board be paid directly to the corporation he represents and not to him?
Tax Professional: RD, Certified Public Accountant (CPA) replied 9 years ago

Yes, in that case(if the original contract was between the employer and the corporation) compensation to the Director can be paid to the corporation. However, how will the director get his compensation in this case. In order to get the remuneration the corporation will than have to pay the Director. SO the final tax impact would be the same whether he receives it directly or the corporation receives it.

 

Let me know if you have any question.

 

Please note: This advice is provided with the understanding that all the relevant facts have been provided by you. Any change in facts might affect the advice given and hence may not be relied on in such cases. Nothing contained in this reply was intended or written to be used, can be used by any taxpayer, or may be relied upon or used by any taxpayer for the purposes of avoiding penalties that may be imposed on the taxpayer under the Internal Revenue Code of 1986, as amended.

 

Ask Your Own Tax Question
Customer reply replied 9 years ago
Thank you for your answer. The director does not want the additional compensation (director's fees) over and above what he already makes from his employer. He's happy for the employer to get the money and the tax consequences. Is there a reference like an IRS Bulletin or something that I can put in my file to support the answer?
Tax Professional: RD, Certified Public Accountant (CPA) replied 9 years ago

There is no IRS bulletin or other reference available for this situation.

It is more like a normal business situation. For eg. if a software consultant is being employed by XYZ Co than he gets his payment from XYZ Co. But, XYZ Co can have him work for their clients such as Cisco, Microsoft or any other corporations. Do thought the software consultant works for all these big companies his remuneration is from XYZ CO and this clients (Cisco, Microsoft etc) pay XYZ Co for these services.

Similar analogy will apply to your situation.

 

RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..
Verified
RD and 87 other Tax Specialists are ready to help you
Ask your own question now
Ask RD Your Own Question
RD
RD
RD, Certified Public Accountant (CPA)
Category: Tax
Satisfied Customers: 8,784
8,784 Satisfied Customers
Experience: CPA, MBA, Over 10 yrs of experience in tax planning and business consulting..

RD is online now

A new question is answered every 9 seconds

How JustAnswer works:

  • Ask an ExpertExperts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional AnswerVia email, text message, or notification as you wait on our site. Ask follow up questions if you need to.
  • 100% Satisfaction GuaranteeRate the answer you receive.

JustAnswer in the News:

Ask-a-doc Web sites: If you've got a quick question, you can try to get an answer from sites that say they have various specialists on hand to give quick answers... Justanswer.com.
JustAnswer.com...has seen a spike since October in legal questions from readers about layoffs, unemployment and severance.
Web sites like justanswer.com/legal
...leave nothing to chance.
Traffic on JustAnswer rose 14 percent...and had nearly 400,000 page views in 30 days...inquiries related to stress, high blood pressure, drinking and heart pain jumped 33 percent.
Tory Johnson, GMA Workplace Contributor, discusses work-from-home jobs, such as JustAnswer in which verified Experts answer people’s questions.
I will tell you that...the things you have to go through to be an Expert are quite rigorous.

What Customers are Saying:

I really was impressed with the prompt response. Your expert was not only a tax expert, but a people expert!!! Her genuine and caring attitude came across in her response...

T.G.WMatteson, IL

I WON!!! I just wanted you to know that your original answer gave me the courage and confidence to go into yesterday's audit ready to fight.

BonnieChesnee, SC

Great service. Answered my complex tax question in detail and provided a lot of additional useful information for my specific situation.

JohnMinneapolis, MN

Excellent information, very quick reply. The experts really take the time to address your questions, it is well worth the fee, for the peace of mind they can provide you with.

OrvilleHesperia, California

Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help.

Mary C.Freshfield, Liverpool, UK

This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!!

AlexLos Angeles, CA

Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult.

GPHesperia, CA

< Previous | Next >

Meet the Experts:

Wallstreet Esq.

Wallstreet Esq.

Tax Attorney

586 satisfied customers

10 years experience

Mark D

Mark D

Enrolled Agent

1,300 satisfied customers

MBA, EA, Specializing in Business and Individual Tax Returns and Issues

Richard

Richard

Tax Attorney

4,310 satisfied customers

29 years of experience as a tax, real estate, and business attorney.

Robin D.

Robin D.

Senior Tax Advisor 4

13,695 satisfied customers

15years with H & R Block. Divisional leader, Instructor

Megan C

Megan C

Certified Public Accountant (CPA)

8,651 satisfied customers

Licensed CPA, CFE, CMA, CGMA who teaches accounting courses at Master's Level

jgordosea

jgordosea

Enrolled Agent

2,885 satisfied customers

I've prepared all types of taxes since 1987.

R. Klein, EA

R. Klein, EA

Enrolled Agent

1,839 satisfied customers

Over 20 Years experience

< Previous | Next >

Related Tax Questions
How does the tax work? ok, family income approx $100k, son
ok, family income approx $100k, son is working part time and has income less than 10K for this year, but has a investment acct of approx 60k want to withdraw approx 15k to buy a car. does this com into conflict with maybe son being charged at our higher tax rate? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
I am completing my personal income taxes. For this filing
I am completing my personal income taxes. For this filing year, I left my corporate career to manage my real estate full time. Therefore, the real estate is moving from a passive activity to an active… read more
LEV
LEV
Retired
Bachelor's Degree
14,896 satisfied customers
We are a software development in India with our clients in
Hi...we are a software development in India with our clients in the US offshoring their software to us. We dont have a establishment in the US. Recently our client gave us the W-8BEN to fill. Could yo… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,463 satisfied customers
Do you have to include VA Disability Compensation in Section
Do you have to include VA Disability Compensation in Section G (Non-Wage Household Income) on IRS Form 433F… read more
abci168
abci168
Principal
27 satisfied customers
This is an IRS tax questions... I have a customer I'm
This is an IRS tax questions... I have a customer I'm working with on an IRS tax debt. The debt only exist because the W2 updates were not filed in a timely manner for a medicare correction to the 941… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,463 satisfied customers
I use Drake Software and I have following codes in Schedule
I use Drake Software and I have following codes in Schedule K-1 form 1065 that I do not know where it will go because they are not on the software. Can someone help:Schedule K-1 1065 Part IIIBox 11 Co… read more
Anne
Anne
Master Tax Preparer
1,328 satisfied customers
Income Tax question: When the AGI is very and none of the
Income Tax question: When the AGI is very and none of the donations are deductible, and standard deduction is taken. Will the donation for that year carry forward even though standard deduction is tak… read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
726 satisfied customers
NYS can collect personal income tax for 20 years? But the
Hi - So NYS can collect personal income tax for 20 years? But the Fed can only collect for 10? … read more
abci168
abci168
Principal
27 satisfied customers
Lane I am using tax software for 1099c cancellation of debt
For Lane: Lane I am using tax software for 1099c cancellation of debt and the box that asks for "debt cancelled while insolvent" it has to be equal or less than the cancellation amount? I thought you … read more
Chad Schoch
Chad Schoch
Bacehlors of Business Administration
20 satisfied customers
How do I request my 2016 Individual Personal Income Tax form
Sir, how do I request my 2016 Individual Personal Income Tax form (form 1040) on line? … read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,463 satisfied customers
How does this process work - compensation? If instead of
If instead of receiving the actual cash from my salary, i instead loan it to the company, will i be taxed the income at the time of when i should receive the cash or later when the loan is repaid? I am the owner. … read more
Chad CFP ®
Chad CFP ®
Certified Financial Planner(R), Pro
Master\u0027s Degree
726 satisfied customers
Is Worker's Compensation payment to be added as income? I
Is Worker's Compensation payment to be added as income? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Can you tell me if workers' compensation settlements
Can you tell me if workers' compensation settlements taxable? … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
I have a Georgia-based LLC established for a software
Hello,I have a Georgia-based LLC established for a software engineering contract in California for $34,000, with the contract expecting to pay out after the beginning of September. I currently don't e… read more
Barbara
Barbara
Enrolled Agent, Paralegal
3,463 satisfied customers
I received a corrected income and tax from the IRS for 2015.
I received a corrected income and tax from the IRS for 2015. The money that they are referring to is a beneficiary payment from my dad's passing. … read more
Mark Taylor
Mark Taylor
Certified Public Accountant
Masters
2,217 satisfied customers
Does tax prep software compare a current return with the
does tax prep software compare a current return with the prior year return ? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
OUR TAX SOFTWARE IS REQUIRING A 1095- OR C SO IS THE IRS
OUR TAX SOFTWARE IS REQUIRING A 1095-B OR C SO IS THE IRS REQUIREMENTS FOR 2017 FOR 2016 TAX RETURNS THERE IS ALOT OF CONFUSION IN THIS MATTER i WOULD LIKE TO KNOW THE irs RULE… read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
What is the Internal Revenue Code Section requires that an
Hi, What is the Internal Revenue Code Section requires that an IRA payable to an Estate be distributed to the Estate within 5 Years? … read more
NPVAdvisor
NPVAdvisor
CFP Licensee and Practitioner
Master's Degree
180 satisfied customers
Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Disclaimer: Information in questions, answers, and other posts on this site ("Posts") comes from individual users, not JustAnswer; JustAnswer is not responsible for Posts. Posts are for general information, are not intended to substitute for informed professional advice (medical, legal, veterinary, financial, etc.), or to establish a professional-client relationship. The site and services are provided "as is" with no warranty or representations by JustAnswer regarding the qualifications of Experts. To see what credentials have been verified by a third-party service, please click on the "Verified" symbol in some Experts' profiles. JustAnswer is not intended or designed for EMERGENCY questions which should be directed immediately by telephone or in-person to qualified professionals.

Show MoreShow Less

Ask Your Question

x