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  1. #1
    Join Date
    Dec 2009
    Posts
    2

    Default Tax on Legal Fees Shown As a Forgiveness Loan

    I work for a certain company who I personally believe is very cheap. They offered me a job on the condition that that I will pay pay back the legal fees if I leave the company within 2 years ( Which I plan to , because the work culture and benefits are so bad).

    Instead of such a contract to that effect, they converted it into a loan and made me sign the documents..

    The legal fees has been changed into a forgiveness loan and every month you spend in the company, they forgive a certain portion of the legal fees. Because they converted this into a forgiveness loan, it shows up on my paystub as a taxable benefit and I end up paying a few hundred dollars every year in taxes.

    The company made it as a forgiveness loan only to safegaurd its interests. Why should I pay taxes on a benefit that the company gets. I am sure the company would have made a tax deduction on the legal fees paid as a business expense!

    Is this legal?

  2. #2
    Join Date
    Jan 2008
    Posts
    1,948

    Question Re: Tax on Legal Fees Shown As a Forgiveness Loan

    never mind - my bad

  3. #3
    Join Date
    Dec 2009
    Posts
    2

    Default Re: Tax on Legal Fees Shown As a Forgiveness Loan

    Quote Quoting 525601minutes
    View Post
    never mind - my bad
    I am sorry, I didnt get that!

  4. #4
    Join Date
    Jan 2008
    Posts
    1,948

    Default Re: Tax on Legal Fees Shown As a Forgiveness Loan

    i posted a few questions but then realized the topic was about visas - so I deleted my original reply - sorry!

  5. #5
    Join Date
    Jan 2007
    Posts
    1,695

    Default Re: Tax on Legal Fees Shown As a Forgiveness Loan

    Have your employment contract and all associated documents reviewed by an attorney. It is impossible for a forum to determine whether the contract is legally constructed and enforcable.

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