Finanse publiczne · 5.12.1994

Deductions for Transfers of Property

This document contains proposed amendments to the regulations to eliminate the special rule that requires an employer to deduct and withhold income tax as a prerequisite for claiming a deduction for property transferred to an employee in connection with the performance of services. Under the existing regulation, employers have been denied a deduction for failure to withhold even where the employee has reported the income and paid the tax. The proposed amendments will provide guidance on substantiating deductions for property transferred in connection with the performance of services. The proposed amendments will affect employers and other service recipients who transfer property for services.