hypothetical federal income tax withholding

[Friday]

To be filed in the "What the f@#$???!!!!" department:

I provide technical support to companies that use Oracle e-Business suite for human resources, financials, benefits, etc.  This is a non-joke support request that just came in:

Date: 12 Jun 2007 14:10:02
TicketID: 5642
Company: name obscured to protect the oppressed
Module: Payroll
Issue Category: Add Bank/Element
Severity: High (Level 2: severe loss of service)

Issue Summary: New Element - Hypo Tax for Expats
Description: We have several employees who have been assigned to London and Australia during the past few months, and we have been advised by KPMG that we need to withhold a hypothetical federal income tax from their pay which will not be remitted to any government.

The attached file describes the type pf element that we need to create.  These employees will continue to be paid on our US payroll, and we need to implement this tax in July.
Attachments: Hypo_Tax_for_Expats.doc

   

[Dreepa]

To be filed in the "What the f@#$???!!!!" department:

I provide technical support to companies that use Oracle e-Business suite for human resources, financials, benefits, etc.  This is a non-joke support request that just came in:

Date: 12 Jun 2007 14:10:02
TicketID: 5642
Company: name obscured to protect the oppressed
Module: Payroll
Issue Category: Add Bank/Element
Severity: High (Level 2: severe loss of service)

Issue Summary: New Element - Hypo Tax for Expats
Description: We have several employees who have been assigned to London and Australia during the past few months, and we have been advised by KPMG that we need to withhold a hypothetical federal income tax from their pay which will not be remitted to any government.

The attached file describes the type pf element that we need to create.  These employees will continue to be paid on our US payroll, and we need to implement this tax in July.
Attachments: Hypo_Tax_for_Expats.doc

   

I love that it is a Sev2.

No tax should be paid on the first $70K (that number may have been changed) earned overseas.

[d_goddard]

In a wonderful full-circle turn of events, in 2003 (the year I learned about the FSP, seeing it on a Slashdot post) I was in Australia. My employer, Oracle, had to file... you guessed it, "hypothetical in come tax" that year, to show what I would pay in taxes if I were in fact in the US at the time.

I remember having to go to a poorly-written web application and click every one of the 365 days in the year, indicating which ones I was in the USA, and which ones I was in Australia.

The truly fucked-up thing was, flying from AU to USA, you lose a calendar day. As in, I didn't have an "October 19th", I went directly from the 18th to the 20th, thanks to the international dateline and a 20-hour flight.

[Dreepa]

The truly fucked-up thing was, flying from AU to USA, you lose a calendar day. As in, I didn't have an "October 19th", I went directly from the 18th to the 20th, thanks to the international dateline and a 20-hour flight.

Denis you were probably working 24 hours that day... so you owe tax on that 'missing day'.  Don't give me any theories about 'missing days'.  You probably had 2 of the same day when you flew back... please remit the taxes for those days as well.

[error]

So, what, KPMG keeps the hypothetical money?