What is the name of your state? Alabama
Here is my problem. The company I work for was just sold. I did not have any shares of stock in the company. However, the CEO who did own about 80-85% of the stock came forward with an e-mail before the sale was complete saying that he was going to give a personal gift to each employee who did not own stock after the sale was completed. Well last week, the sale went through and yesterday we got our checks (drawn from a personal bank account with the CEO's name on it). However, we also were given a W9 form to fill out when we got the checks. Today, the company's CFO comes forward and says that it's only logical that we should plan on paying the tax on the money from the CEO. The amount was less than the $11,000 gift tax limit. So a few questions: Because we filled out W9 forms, does that automatically mean that we are responsible for the tax on that money? Does the CEO not have to pay capital gains tax on the portion of the money he received from the sale of his stock which he later re-distributed to use via these gifts? How would the checks he wrote us be deductible to him for tax purposes since we provided no service or good in exchange for that money (we already were paid our salaries, annual bonuses, etc)? Please help! I need to KNOW if I have to plan on paying taxes on this gift money or not. I don't want to have to play it safe and save out 35% if I don't have to. Thanks alot!
Here is my problem. The company I work for was just sold. I did not have any shares of stock in the company. However, the CEO who did own about 80-85% of the stock came forward with an e-mail before the sale was complete saying that he was going to give a personal gift to each employee who did not own stock after the sale was completed. Well last week, the sale went through and yesterday we got our checks (drawn from a personal bank account with the CEO's name on it). However, we also were given a W9 form to fill out when we got the checks. Today, the company's CFO comes forward and says that it's only logical that we should plan on paying the tax on the money from the CEO. The amount was less than the $11,000 gift tax limit. So a few questions: Because we filled out W9 forms, does that automatically mean that we are responsible for the tax on that money? Does the CEO not have to pay capital gains tax on the portion of the money he received from the sale of his stock which he later re-distributed to use via these gifts? How would the checks he wrote us be deductible to him for tax purposes since we provided no service or good in exchange for that money (we already were paid our salaries, annual bonuses, etc)? Please help! I need to KNOW if I have to plan on paying taxes on this gift money or not. I don't want to have to play it safe and save out 35% if I don't have to. Thanks alot!