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No work was actually performed and the employees were new hires. I want to compensate them because they agreed to work on the project for a specified period of time (some quit their existing jobs) and the project was cancelled at the last minute through no falut of their own. I was able to convince my client to compensate me for a portion of the cancelled project. I would like to provide my employees compensation without paying them a salary or bonus because all these have tax consequences (for me and them). For example, I have to pay workers comp and payroll taxes on their salary. ALso, my general liability and worker's comp are based on total payroll. I called the California Employment Development Dept (responsible for payroll taxes etc) and they suggested giving a gift. But apparently this is not considered an expense. Any advice would be appreciated!
Consider this approach: 1. Withdraw cash money from bank, distribute as cash bonus, no taxes out 2. Add bonus paid amount to payroll period when distribution occurred, thus causing taxes to be paid by employee and you, then deduct net paid from payroll in deductions columns, booked as "cash bonus paid out" or "cash advance" or similer, becomes a payroll liability 3. Re book cash out as liability paid so it equals out.
If it's a decent amount of money for each worker...put cash in envelopes and discreetly give to each one as a gift. If it's not a large amount of money, host a party or barbeque in their honor...another suggestion would be gift cards. You can purchase Visa or Master Card gift cards so that each employee could use the money as he or she sees fit. By the way...I think it's awesome that you want to do this for the people who work for you!!! CONGRATULATIONS on being an employer with a heart and who cares!
There are better than each person might like to believe. working a shape employer I even have adult adult males get mad when I ask them to fill out tax papers. they might rather artwork for instantly funds. human beings can take a seat there and say that they do no longer try this yet THEY DO. I even have seen human beings substitute the style of dependents each and every 6 months to maintain from getting plenty taken out of their tests from a prior job I worked at. I even have seen others no longer document their taxes. the priority lies interior of us as human beings. we don't do issues as we are think do, why might we are looking forward to something much less from others entering this u . s ..
Depending on the amount/costs, how about a harbour cruise, a dinner at an expensive restuarant or give them each a weekend away? Good luck.
Forget the taxes some of them quit there jobs give them the money and call it Charity and file it on your taxes
Take the money recieved from your client and brain storm with these new hires, and find a new project for them....
Give a gift card.
SO GIVE THEM A CHRISTMAS GIFT OF CASH........... Westlake JUST A PLAIN OLD GIFT...............OF CASH...