5 ms·

> why should we burden the business owner with the responsibility to pay when someone is sick and unable to work? Is it really such burden to the business owne

> why should we burden the business owner with the responsibility to pay when someone is sick and unable to work? Is it really such burden to the business owner to see to the well-being of their employees? > At the very least, the gov could offer a tax break for wages paid sick workers. I like this idea, tbqh.

sokoloff 7y ago
Wages paid are deductible business expenses already.
- inetknght 7y ago
  > Wages paid are deductible business expenses already. Up to how much? I can't imagine wages paid are 100% deductible. Otherwise nothing's stopping people from starting businesses and paying wages to friends to reduce tax burdens...
  - sokoloff 7y ago
    Up to any amount, provided they are: Ordinary and necessary, Reasonable in amount, Paid for services actually provided, Paid for or incurred in the tax year. And the "any amount" has a limit beyond which you are found to not be operating a profit-seeking business. (Those are the fairly standard tests for all business deductions, only the third is at all specific to wages.) There's no way to "make money" by incurring additional expenses and deducting them. If you have $100 in deductible business expenses and your marginal rate is 35%, you are paying $100 in expenses and getting back $35 on your taxes, so you're still out of pocket $65.
    - deleted 7y ago
      [deleted]
    - perl4ever 7y ago
      "There's [usually] no way"
  - hizanberg 7y ago
    It’s 100% deductible just like most other businesses expenses given you only pay taxes on net profits, if it weren’t tax deductible you would end up with a higher tax burden than what your business makes and therefore can pay. Paying family/friends wages counts as a business expense to the company and taxable revenue to the employee. The business can also incur additional overheads for having employees like payroll taxes, super, etc.
dboreham 7y ago
Not trying to argue the other side, but there are people who claim to be sick when they just want to be paid to not work. So an ideal system should also deal with that possibility.
- johnisgood 7y ago
  There is a limit around where I live here in Eastern Europe. 15 days per year but there are exceptions such as pregnancy and whatnot. Plus they abolished a particular law so now the employer can fire you while you are on sick pay.

sokoloff 7y ago

Wages paid are deductible business expenses already.

inetknght 7y ago
> Wages paid are deductible business expenses already. Up to how much? I can't imagine wages paid are 100% deductible. Otherwise nothing's stopping people from starting businesses and paying wages to friends to reduce tax burdens...
- sokoloff 7y ago
  Up to any amount, provided they are: Ordinary and necessary, Reasonable in amount, Paid for services actually provided, Paid for or incurred in the tax year. And the "any amount" has a limit beyond which you are found to not be operating a profit-seeking business. (Those are the fairly standard tests for all business deductions, only the third is at all specific to wages.) There's no way to "make money" by incurring additional expenses and deducting them. If you have $100 in deductible business expenses and your marginal rate is 35%, you are paying $100 in expenses and getting back $35 on your taxes, so you're still out of pocket $65.
  - deleted 7y ago
    [deleted]
  - perl4ever 7y ago
    "There's [usually] no way"
- hizanberg 7y ago
  It’s 100% deductible just like most other businesses expenses given you only pay taxes on net profits, if it weren’t tax deductible you would end up with a higher tax burden than what your business makes and therefore can pay. Paying family/friends wages counts as a business expense to the company and taxable revenue to the employee. The business can also incur additional overheads for having employees like payroll taxes, super, etc.

dboreham 7y ago

Not trying to argue the other side, but there are people who claim to be sick when they just want to be paid to not work. So an ideal system should also deal with that possibility.

johnisgood 7y ago
There is a limit around where I live here in Eastern Europe. 15 days per year but there are exceptions such as pregnancy and whatnot. Plus they abolished a particular law so now the employer can fire you while you are on sick pay.