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AWS gives out thousands of service credits to new US-based startups for free, so I'd find it hard to believe that those companies would be getting taxed for suc
by ezekg 5y ago
AWS gives out thousands of service credits to new US-based startups for free, so I'd find it hard to believe that those companies would be getting taxed for such a thing. I don't think those credits are taxable, in the US at least, because they are non-transferable, i.e. you can't redeem them for fiat currency.
- conductr 5y agoThe way I’d understand it is you should claim the income but only the portion that offset your expenses thus a net zero and no tax liability. For example, Amazon give you $100,000. When you use only $1,000 you claim $1,000 income and $1,000 of expense. The other $99,000 is like a loan balance that hasn’t transferred to you or been “realized” and is therefore not taxable and shouldn’t even be reported afaik
- handrous 5y agoYeah, but this looks like turning actual money that they have in their hands into a "credit", and it's conditional on money changing hands and some of that actual money going to both parties involved, not a promotional credit generated out of thin air and offered to anyone who signs up. This looks an awful lot like payment-in-kind.
- tedk-42 5y agoit's not a payment. you and the other poster are confused because in both cases yes your gross profit is higher and you do indeed need to pay taxes on that. but in no way did AWS provide you with a source of income. they mearly decreased your expenses.