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This Diary might just piss you off ....

    Pulitzer Prize-winning journalist and author wrote a brilliant, and maddening, article for Reuters describing the fact that many large Corporations, posting record profits have a "deal" with Governors and Legislatures in many States (mostly Red) where the Corporations get to POCKET Employee's State Taxes without the Employee's knowledge.

     This new method of State Corporate Subsidy boils down to: Employee's are being Taxed by their Corporate Employer and not being Taxed by their State.  

     Also, the old Corporate Subsidy method, the Corporation would get a Finite Dollar Value of subsidy but as this new method allows Corporate Subsidies to be INFINITE while at the same time, State's are being depleted of MUCH NEEDED Revenue to fund Public Projects.

     The way it's done: Corporations are withholding State Taxes from their Employee's wages but the Corporation is pocketing their employee's State Taxes and never, ever sending the Employee's State Taxes in to their State's Revenue Cabinet.

     So, at the end of the year, the Employee gets their W-2 and it shows State Taxes were withheld ... but unbeknownst to the Employee, those State Taxes were NEVER sent to their State's Revenue Cabinet as their Corporate Employer pocketed the money.

        In short, while State's are cutting and gutting: education, infrastructure spending, cops, firemen, etc., Governors and Legislatures are allowing large Corporations to "steal" employee's State Withholding Tax.

    That means, Employee Taxes, that are supposed to be used to Fund Public Projects have been DIVERTED to Private Corporations for Private Gain without the employee's knowledge.

    Those States are:
-Ohio (GOP House Majority John Boehner's State & Gov Kasich-R)
-Kentucky (GOP Minority Leader Mitch McConnell's State)
-New Jersey (Gov Christie-R)
-Indiana (Gov Mitch Daniels-R)
-Kansas (Gov Brownback-R)
-South Carolina (Gov Nikki Haley-R)
-Georgia (Gov Nathan Deal-R)
-Mississippi (Gov Bryant -R)
-Maine (Gov Paul LePage-R)
-New Mexico (Gov Susana Martinez -R)
-Utah (Gov Gary Herbert-R) 
-Illinois (Gov Pat Quinn-D)
-North Carolina (Gov Bev Perdue-D)
-Colorado (Gov. John Hickenlooper-D)
-Missouri (Gov Jay Nixon-D)
-Connecticut (Gov Malloy-D)
    Notice Speaker John Boehner, Sen Mitch McConnell, and many of the Governors listed are the loudest to B!TCH about the evils of welfare! This IS Corporate Welfare and Corporate THEFT of Employee's Money.  

     Mitch McConnell and John Boehner are very powerful men in their states who are very aware of their State's Revenues and even though they do not write their State's Laws, they are very aware their State's Laws that govern Corporate Welfare. Thus, if they did not want their state's to let Corporations pocket American Worker's State Taxes, then those states would not. Therefore, one can reasonably conclude: both Mitch McConnell and John Boehner support their states letting Corporations pocket their employee's money without the employee's knowledge.

     Here is a list of some of the Large Corporations that are allowed to keep their employee's State Taxes without the employee's knowledge are:

Goldman Sachs
Fidelity Global Brokerage
Lord Abbett & Co
ICAP North America
Marathon Petroleum
Nisson
Toyota
Ford Motor/Suppliers
Sears
GE
Google (Motorola mobility)
NCR
Procter & Gamble
American Greeting
Bath Iron Works
General Motors
Sanofi-Aventis US
AMC Entertainment
IM Flash Technologies
Verizon
Adobe
    While loyal, neighborhood mom & pop shops struggle to pay Employee Taxes quarterly, State Governors and Legislators have a quiet "deal" that allows Large, profitable Corporations to steal their employee's money for Private Profit.

     Historically, Employers who Withhold Employee's State Taxes are required, by law, to pay the State Revenue Department those Withheld monies. Employers who withheld but did not send the Employee's withheld money to the State Revenue could be charged with a Felony (Theft).

    Why not sending in employee's withheld State Taxes is a Felony:

1)  John Doe owe's $20,000.00 in yearly State Taxes based off of wages.  

2) Rather than John Doe writing a $20,000.00 check to the State, the Employer takes out Mr. Doe's $20,000.00 Tax Liability in increments weekly, monthly or bi-monthly.

3) The Employer then sends Mr. Doe's $20,000.00 to the State Revenue.

4) The State Revenue Cabinet puts Mr. Doe's $20,000.00 into Mr. Doe's Tax Liability Account.

5) At the end of the year, Mr. Doe fills out his Federal and State Tax Forms and submits his w-2 showing $20,000.00 was taken out of Mr. Doe's wages.

keywords: Mr. Doe's wages.

    Because the $20,000.00 belongs TO Mr. Doe - when his employer keeps the $20,000.00 and never sends it to the State Revenue Cabinet ... the employer is guilty of STEALING $20,000.00 from Mr. Doe.  That is why it is a Felony if an employer does not send Mr. Doe's $20,000.00 into the State Revenue to be put in Mr. Doe's Tax Liability Account.

    Could Mr. Doe be guilty of DeFrauding the IRS without even knowing it?

     What happens if Mr. Doe is audited by the State or by the IRS? Employees deduct State Taxes from "income" for Federal Tax filing. Thus, if the monies are not ever going into the State Revenue then the monies are NOT, in fact, Taxes.  Therefore, Mr. Doe could be DeFrauding the IRS without even knowing it.

     Is Mr. Doe's State Unemployment Account EMPTY without even knowing it?

    So, what happens if Mr. Doe gets laid-off and tries to file for unemployment? Since Mr. Doe's Corporate Employer KEPT Mr. Doe's State Taxes, there is no money in Mr. Doe's State Revenue Account to pay him his State Unemployment.

     From Mr. Johnston's Article:

AMC Entertainmentannounced a deal last year to move its corporate headquarters from Kansas City, Mo., to a nearby Kansas suburb. In return, Kansas will let the multiplex chain keep $47 million of state income taxes withheld from its workers’ paychecks, a drain on public finances that did not create any jobs, but does enrich the Wall Street firms that own AMC including arms of J. P. Morgan, Apollo Management, Bain Capital and the Carlyle Group. AMC declined to answer my questions.
     
     I wonder how much Mitt Romney is Personally Profiting by his holdings in Bain Capital from this disgusting act of stealing Employee's State Tax money.

9:54 AM PT: To Avoid Confusion that at least one poster has: Corporations KEEPING Employee's State Taxes means, the employees of the Corporation are the ONLY ONES paying that Corporation's Subsidy.

Contrary to the OLD method - where State Corporate Subsidies were a "Finite" number and were funded by all working citizens of a State ... this new method makes it so that the Corporations Employee's Taxes are the ONLY Taxes paying for the Corp Subsidies and the Dollar Amount of the Corporation's Subsidy is "INFINITE."

In other words, unlike past State Corp Subsidies - these type of Subsidies boil down to the Employee Being Taxed BY Their Corp Employer, not their State.  Anyone having additional confusion should click on Johnston's link which I provided at the top of this Diary.


10:33 AM PT: Because of confusion by some posters here, I called the Ohio Revenue Cabinet (as that is John Boehner's State) Here is a summary of my conversation:

I asked, IF my employer withholds State Taxes from my wages but does not send that money into the State, have I met my State Tax Obligation.

The answer was, No, you would not have met your Tax Obligation because the Account with my name next to it will show: Monies from Taxes owed off of wages earned have not been put into the Account bearing my name.

Then the person said, "it is a Felony for an employer to withhold taxes and not send those Taxes in to the State.

My next question was: If the State offered the Corporate employer a $5000.00 Subsidy - Would it be ok for the Corporate employer to just keep $5000.00 from their employee's State Tax Withholding.

The answer was: No, Accounts for Subsidies are in a different "pot" than Accounts for State Employee Taxes.  Subsidy Accounts start at the beginning of the Fiscal Year - not at the end.  While State Employee Tax Accounts begin at the END of the year.

The Ohio Revenue Person also said: The Employee Tax Withholding Account and the Subsidy Accounts never crossover.

The phone number of the Ohio Revenue Cabinet is:
(800) 757-6091 extension: 6

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Comment Preferences

  •  This is especially interesting since here (10+ / 0-)

    in Georgia, there will be a referendum for a 1 cent sales tax to go for transportation projects. No wonder they need more money since the taxes some of us pay never make it into state coffers! And while we're being promised that they money will not be used only for roads, but public transportation as well, many areas are looking foward to having that money repair our badly degraded roads which have been neglected due to budget cuts.

    And so the little guy is bled by a thousand cuts.

    "The object of persecution is persecution. The object of torture is torture. The object of power is power. Now do you begin to understand me?" ~Orwell, "1984"

    by Lily O Lady on Tue Apr 17, 2012 at 09:18:38 AM PDT

  •  I used to work (4+ / 0-)
    Recommended by:
    msmacgyver, Lujane, keepemhonest, JVolvo

    for IRS. While this would never happen at the federal level, the state is a different thing.
    I completely agree with you that this is some kind of fraud. The W-2 shows state tax withheld. If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses. If the money is not sent to the state, I should be able to sue to get that money back.
    Am I being logical here?
    I also agree that IRS could sue the employee because they entered state tax as a way to reduce federal tax. If the state tax is not paid to the state then you have falsified your federal return.
    Whoever thought this up is a fool.

    The only foes that threaten America are the enemies at home, and those are ignorance, superstition, and incompetence. - Elbert Hubbard -9.62/-8.15

    by GustavMahler on Tue Apr 17, 2012 at 09:33:49 AM PDT

  •  cc - your diary isn't giving the complete story (7+ / 0-)

    The diary suggests that the listed companies are committing tax fraud and are somehow being shielded by GOP politicians. As anyone who has ever been an employer knows there are few things you always do and one of them is to be certain that you send withheld taxes to the federal and state government. If you don't you go to jail. Each of the listed companies are in full compliance with state withholding tax law.

    This all starts with deals between states and companies to attract or retain jobs. Now, you can be for or against such deals, and most here oppose them, but that is a different issue than the dairy discusses.

    It is important to remember that this starts with the FACT that the state has a contractual obligation to pay the company a specific amount of money each year. Rather than sending the income taxes that are collected from each employee to the state, and then having the state send the money back, the company just reports the numbers and keeps the cash. At the end of the year everything is accounted for to make sure the state and the company have upheld the terms of the contract.

    Here is the take home message, every employee receives full credit for their withheld state taxes and their W2 looks no different than had the cash actually gone to the state at each payroll cycle. This is not harming employees at all.

    Now you can be against these state deals, but the record keeping seems appropriate and sensible, the companies are in compliance with state income tax laws, and this is not negatively affecting any employee.

    "let's talk about that"

    by VClib on Tue Apr 17, 2012 at 09:36:18 AM PDT

    •  U are 100% WRONG in Fact (1+ / 0-)
      Recommended by:
      MKSinSA

      this article HIGHLIGHTS that you are WRONG

      This article Highlights that NOW State Governors and Legislatures are allowing CORPORATIONS TO KEEP (NEVER SEND) Employee Withholding Tax without the Employee's knowledge.

      That mean's these Corps are NOT sending in the Employee's withheld taxes to the state - the Corps are POCKETING THE MONEY and never sending it in.

      I suggest you read the FACTS of this article -

      •  Is your issue that employees don't know, (4+ / 0-)

        or that companies are paying the difference between what the state owes the company and employee withholding?

        Or are you saying that companies are not paying the state employee withholding and the state does not owe the company any payment?  

        Or is it something else?

        The most important way to protect the environment is not to have more than one child.

        by nextstep on Tue Apr 17, 2012 at 09:48:57 AM PDT

        [ Parent ]

        •  No, I'm saying The Corporations Pocket 100% of ALL (0+ / 0-)

          their Employee's State Taxes

          Which means, Corporations are taxing their workers

          •  If the amount the state owes the company (3+ / 0-)
            Recommended by:
            johnny wurster, erush1345, VClib

            is greater than the employee state withholding, and the employees get full credit for their taxes paid, and this is not a violation of law -- how is any party hurt?

            If the state does not owe the company money, this would already be covered as a crime - a crime taken very seriously by states.

            The most important way to protect the environment is not to have more than one child.

            by nextstep on Tue Apr 17, 2012 at 11:30:14 AM PDT

            [ Parent ]

      •  cc - the employees all receive credit (4+ / 0-)

        The companies are keeping the cash but the employees are receiving the credit as if the money was sent. Just think about this for a moment. Do you really think that if these thousands, or tens of thousands, of employees received a W2 that showed no withholding for state income taxes that we would not hear about it? Each of these employees would have to pay their state taxes a second time and likely with penalties, and they would never question that? That the state auditors would not notice that every W2 had a 0 for state taxes withheld, which is a criminal violation, and would not start an enforcement action against the companies? Just pause a moment and think this through. What I have outlined in my comment is exactly how this works and is the only thing that makes any logical sense.

        "let's talk about that"

        by VClib on Tue Apr 17, 2012 at 09:53:24 AM PDT

        [ Parent ]

        •  No, you are WRONG AGAIN (0+ / 0-)

          Why do you post stuff on blogs/Diaries when you have NO IDEA what you are talking about?

        •  If you READ before you POST you would know (0+ / 0-)

          that the Employee's are NOT BEING TOLD that their State Tax Withholding is not being sent in to their State Revenue Cabinet.

          I really urge you to READ before you post.

          Since you are so confused and so factually wrong, I urge you to read David Cay Johnston's "Taxed By The Boss" that I referenced and LINKED to in the first paragraph of my Diary

          Link in case you can't find it within the Diary:
          http://blogs.reuters.com/...

          •  They don't NEED to be TOLD (3+ / 0-)
            Recommended by:
            nchristine, johnny wurster, erush1345

            Legally their obligation as employees has been met. They have paid their taxes.

            Now, morally, as tax payers, I agree that many of the citizens would probably not be happy with the idea of the state saying to the company - "hey, we want to keep your company here in our fine state, so we will show that your employees have paid the proper $XXXX in taxes, and we agree also that we will give you $XXXX in subsidies. In fact, to save postage and all, instead of you cutting a check and sending us that $XXXX and we'd just have to turn around and cut another check and send it right back to you - you guys just keep it, OK?"  Many citizens would prefer that their tax money not go to subsidizing that company - they would prefer that it go to schools and health clinics and repairing bridges. On the other hand, many citizens would fully support it going to the company, so the company doesn't take its jobs and its buying power three states over.

            What's wrong here is not a legal issue, but a transparency issue - all citizens, including those who pay those payroll taxes, and the businesses who don't have sweet heart deals, should be able to see quite clearly that the state is "gifting" selected corporations with $XXXX; and have a proper conversation about that. Even so it is not a wrongness that justifies you YELLING at people and telling them they are WRONG, when they aren't.

            from a bright young conservative: “I’m watching my first GOP debate…and WE SOUND LIKE CRAZY PEOPLE!!!!”

            by Catte Nappe on Tue Apr 17, 2012 at 10:11:13 AM PDT

            [ Parent ]

            •  I challenge you to call YOUR State Revenue Cabinet (0+ / 0-)

              and tell them, word for word of what you posted --- and they will explain why you are wrong.

              For instance, if you asked your State Rev Cab if they want Corporations to keep Employee withholding money to save on stamps --- and they will explain why that is NOT EVER how it is to work.

              Seriously, call your State Rev Cab and let them enlighten you on why your comment is not correct.

              •  Don't have a State Revenue Cabinet (1+ / 0-)
                Recommended by:
                erush1345

                And no, such deals aren't made "to save on stamps", that was a simplification, since you couldn't seem to grasp the more complex explanations other posters were providing you with. What the companies are doing is legal. What the state is doing is legal. No employee was harmed in the arrangement. Citizens, yes - at least those citizens who prefers schools and bridges to corporate welfare.

                from a bright young conservative: “I’m watching my first GOP debate…and WE SOUND LIKE CRAZY PEOPLE!!!!”

                by Catte Nappe on Tue Apr 17, 2012 at 10:25:31 AM PDT

                [ Parent ]

            •  BTW: (0+ / 0-)

              I only use CAPS as a form of emphasizing, not as a form of yelling.  

            •  Also, State Rev Cab would NOT say ... (0+ / 0-)

              employees obligation is met.

              Again, please call your State Rev Cabinet and ask them:
              IF: an employee has State withholding taken out of their wages but their Employer has not sent the money to the State Revenue Cabinet, has the employee's obligation been met.

              There answer will be: No.

              •  cc - except in those circumstances (2+ / 0-)
                Recommended by:
                Catte Nappe, erush1345

                when the state and a company have a contractual relationship  that makes this arrangement legal. The fact that the companies don't disclose this to their employees does not impact its legality.

                In companies where these contracts are in place these
                are the questions you need to answer for yourself:

                1. Does each employee's W2 show, in the State Taxes Withheld column, an amount that is appropriate given their wages and withholding instructions?

                2. When each employee files their state tax return does the state accept the numbers in the W2 as paid-in-taxes?

                3. If any employee applies for unemployment, or any other state benefit, does the state treat them exactly the same as citizens who have employers who send in their withholding in the more normal fashion?

                If the answers to each of these questions is YES, then I don't see how the employees have been harmed.

                "let's talk about that"

                by VClib on Tue Apr 17, 2012 at 10:42:44 AM PDT

                [ Parent ]

                •  Again IF you read BEFORE you post you would know (0+ / 0-)

                  that my Diary answered those questions you asked.  But to make simple on you - let me answer you AGAIN here:

                  1) Yes

                  2) yes

                  3) NO.

                  Ohio Revenue Cabinet told me that to your #3, the answer is NO.

                  Also, if you read my Diary before you post you will see where I already address that issue:

                  "what happens if Mr. Doe gets laid-off and tries to file for unemployment? Since Mr. Doe's Corporate Employer KEPT Mr. Doe's State Taxes, there is no money in Mr. Doe's State Revenue Account to pay him his State Unemployment."

                  That part of my Diary was written after I spoke with the Ohio Revenue Cabinet  --- and clearly you did not read my Diary

                  In my opinion people who do not read a Diary yet post comments complaining about the Diary  are ... well ... not very bright people, don't you agree?

                  •  cc - your question to the State of Ohio (1+ / 0-)
                    Recommended by:
                    erush1345

                    was incomplete. You can't ask a generic question because each of these deals likely had a specific piece of legislation, or a blanket law, under which these issues were addressed. Each of these contracts were signed by the governor, or his/her representative and were crafted to make sure that the impact of the arrangements would not negatively impact the employees.  So the question to ask is about a specific company that has one of these deals with the state.

                     It is inconceivable that all the employees at all the companies are not eligible for unemployment compensation in their states. Do you really think that if these employees were uniformly denied state unemployment benefits, that they should have qualified for, we would have never heard about it?

                    "let's talk about that"

                    by VClib on Tue Apr 17, 2012 at 11:05:54 AM PDT

                    [ Parent ]

                    •  yes, and there is a lot we don't hear about at (0+ / 0-)

                      state levels.

                      Also, seems - even by your comments - that if an employee did not get unemployment because of this Corrupt/Crony Law ... people like you would say, "oh well, it is the law and it was signed by the governor"

                      Plus, I don't know if you've noticed but there are a lot of very serious injustices done to employers in all states of this country where very few people ever actually hear about.

                      I find it interesting that anyone would be "ok" with these Crony Laws that are geared to strip State's of valuable, much needed Revenue -- but apparently, you are.

                      •  cc - no I'm not (1+ / 0-)
                        Recommended by:
                        erush1345

                        There are two issues here the deals that states make with companies to attract or retain jobs and the details of how these deals are funded.

                        I don't like the sweetheart deals that give tax breaks to companies for relocating or staying in a state. That is a completely separate issue from how the state and the companies decide how to fund the amount of money the state owes the company. Keeping the cash from personal state withholding of its employees might not be how I would structure it but there is nothing illegal about it, and I am firmly convinced that no employees are harmed.

                        If you can find me five employees of any of these companies who had their unemployment benefits declined specifically because of the contractual relationship between their former employer and the state, I would change my mind.  

                        "let's talk about that"

                        by VClib on Tue Apr 17, 2012 at 12:11:41 PM PDT

                        [ Parent ]

                        •  You don't seem to know what you're talking about (0+ / 0-)
                        •  I can give you five employees who were harmed by (0+ / 0-)

                          this corrupt law ....

                          secretary, receptionist, mail clerk, in-house accountant, file clerk plus all the employees of these Corporations who live in those states.

                          you see -- because you did not read the Diary, you never understood the underlying content.

                          As Eric Nelson, who understood the Diary, wrote below here:
                          "The employee & all citizens of the state were hurt by the loss of revenue caused by the increasing tactic of the manufactured threat of "job piracy" - blackmail in essence."

                          There, now you have 5employees plus everyone who lives in those states as people who are harmed, directly harmed by these laws.

                          Others hurt by these laws are "mom&pop shop" who struggle to pay the quarterly Employee Taxes to these States while their rich Corporate competitor "pockets" the Employee Taxes for Private Profit.

                          Look up the word "Private" then look up the word "Public"

                          Employee State Taxes are designed to pay "Public Projects" and are not designed to go to "Private Profit"

                          Employee's pay stubs have:
                          "Deduction for State Withholding" not
                          "Deduction for Kickback to Corporation" -- why not? hmmm....

                •  Indeed, using the law to subordinate (3+ / 0-)
                  Recommended by:
                  cc, keepemhonest, Eric Nelson

                  individuals has a long history.  Even killing another person is legal, if due process has been followed.
                  If respect for the law is to be restored, then we've got to stop letting scofflaws write legislation to benefit their business associates and cronies.
                  The enslavement of people acquired in the market used to be legal. The ownership of juveniles is still legal.  The deprivation of human rights based on an individual's sexual associations is legal.
                  That the law ought to be moral is an ideal that has never yet been achieved.
                  Strangely enough, it's the idealists who most resist it.

                  People to Wall Street: "LET OUR MONEY GO"

                  by hannah on Tue Apr 17, 2012 at 11:06:29 AM PDT

                  [ Parent ]

    •  Also You FAIL Tax Law (2+ / 0-)
      Recommended by:
      TBug, keepemhonest

      State & Federal Tax Laws

      1) Subsidies are monies that are put in an Account and start at the BEGINNING of the Fiscal Year (not the end).

      2) Employee State Taxes are put in a SEPARATE Account and stays there until the END of the Year (not the beginning)

      3) Keeping it simple:
      When a State says a Corp will get $250 a year - then the state goes into the State's Subsidy Account and writes a check - or the Corp can simply reduce THEIR LIABILITY from their Tax Forms and get that money that way.

      Thus, this manner dictates that ALL Employees of the entire state pay a portion of the Corporation's Subsidy.

      However - when the Corp keeps $250 a year from THEIR Employees, then THEIR EMPLOYEES are subsidizing the Corp and NOT the citizens of the entire State.

    •  When David Cay Johnston was speaking on.. (3+ / 0-)
      Recommended by:
      cc, keepemhonest, duufus

      ..this issue his complaint wasn't focused on the employee being hurt by not knowing that companies were holding onto taxes or that the companies were breaking laws, but by taxes not making it to the state coffers.

      The employee & all citizens of the state were hurt by the loss of revenue caused by the increasing tactic of the manufactured threat of "job piracy" - blackmail in essence

      “Job blackmail” occurs when a company threatens to close a plant unless it gets tax money.

       In Illinois, the law requires companies to threaten to leave before they can keep taxes withheld from paychecks. Motorola Mobility, now being acquired by Google; the truck maker Navistar; the German manufacturer Continental Tire, and three auto makers – Chrysler, Ford and Mitsubishi – get to keep $346.8 in taxes over 10 years because they threatened to leave Illinois. Navistar can pocket $62.1 million even if it fires a quarter of its Illinois workforce, its contract shows. A recent deal gives Sears $150 million, Good Jobs First reported.

      It's the ruse aspect of this scheme that is the complaint. Playing with tax law (not illegal), avoiding competition by playing with the scenario of competition rather than actual competing. Smart moves yes but true competition?
      PROMISES OF JOBS

      Promising to retain jobs can be lucrative. General Electric invested $126 million updating part of its Ohio operations. In return, GE gets a tax credit equal to $115.3 million of its worker taxes, recovering 92 percent of its investment. A sweet deal for GE, but not its competitors.

      Corporate welfare isn't far off the mark in this game of what-if-we move-or what-if-we-stay game.
      •  True, but the diarist runs off the tracks (1+ / 0-)
        Recommended by:
        erush1345

        and into tinfoil hat land is where she claims that this is "fraud" and that the employee doesn't get contributed with his payroll deductions.

        VClib was pointing out where that train goes off the rails.

        •  w2 says Deduction 4Tax but not Used as Tax $=Fraud (0+ / 0-)

          From poster GustavMaher

          for IRS. While this would never happen at the federal level, the state is a different thing.

          I completely agree with you [cc]  that this is some kind of fraud. The W-2 shows state tax withheld. If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses. If the money is not sent to the state, I should be able to sue to get that money back.

          I also agree that IRS could sue the employee because they entered state tax as a way to reduce federal tax. If the state tax is not paid to the state then you have falsified your federal return.
          Whoever thought this up is a fool.

          I don't know how you can't see this as fraud perpetrated on both the employee and on the residents of each state.

          Money that is Deducted as State Taxes but not used as State Taxes is Fraud.

          State Taxes pay for a lot of things: education, state police, roads, bridges, etc

          Again, since the money Deducted as "State Taxes" is not being used as State Tax money is supposed to be used then the employee is being defrauded as are those residents relying on State Tax money for: education etc

          Seriously, how is it that you don't understand that very obvious fact.

      •  Eric - I completely agree (1+ / 0-)
        Recommended by:
        erush1345

        I don't like these deals, but now that they are signed how the cash is paid is a completely separate issue. Given that these deals are already done, the only issue is the time value of money which could certainly have been baked into the contract to make it equitable for all parties.  

        "let's talk about that"

        by VClib on Tue Apr 17, 2012 at 01:50:12 PM PDT

        [ Parent ]

        •  equitable for the Corps & lawmakers but not the (1+ / 0-)
          Recommended by:
          Eric Nelson

          residents of those states that rely on State Tax Money to fund: Education, state police, roads, bridges, welfare ...

          ahhh but that's ok, so long as those large Corps posting those record profits make more profits - who cares about "the People"

    •  Did you even read this Diary? (1+ / 0-)
      Recommended by:
      duufus

      This Diary is not suggesting the Corps are committing tax fraud - this Diary highlights that Corps are stealing State Revenue due thanks to GOP cronyism who write laws that benefit large Corps and do not benefit "mom&pop shops."

      This Diary said:
      1) "While loyal, neighborhood mom & pop shops struggle to pay Employee Taxes quarterly, State Governors and Legislators have a quiet "deal" that allows Large, profitable Corporations to steal their employee's money for Private Profit."

      2) "Historically, Employers who Withhold Employee's State Taxes are required, by law, to pay the State Revenue Department those Withheld monies. Employers who withheld but did not send the Employee's withheld money to the State Revenue could be charged with a Felony (Theft)."

      When the word, "Historically" is written in a sentence it generally means "in the past" - not current, not future, but past.

      3) "Notice Speaker John Boehner, Sen Mitch McConnell, and many of the Governors listed are the loudest to B!TCH about the evils of welfare! This IS Corporate Welfare and Corporate THEFT of Employee's Money."

      No matter if there is a corrupt law allows the Corps to keep employee's Tax money, it is still THEFT by the fact that the money is earmarked as a State Tax for Public Projects - not earmarked as a "GivAway" to the employee's Corp employer.

      I think this is really, theft by deception - because the lawmakers and the Corporation are going out of their way to keep the employee in the dark and going so far as actually having the employee "think" their (employee's) money is going to the State Tax Fund.

      Yeah, so - corrupt laws that benefit only large Corporations and not "mom&pops" is not only an unfair business model - it is also "theft by deception."

      I guess "Theft by Deception" is fine with you, so long as it was written by lawmakers ...

    •  VCLib - I don't think you even read this Diary (0+ / 0-)

      This Diary is not suggesting the Corps are committing tax fraud - this Diary highlights that Corps are stealing State Revenue due thanks to GOP cronyism who write laws that benefit large Corps and do not benefit "mom&pop shops."

      This Diary said:
      1) "While loyal, neighborhood mom & pop shops struggle to pay Employee Taxes quarterly, State Governors and Legislators have a quiet "deal" that allows Large, profitable Corporations to steal their employee's money for Private Profit."

      2) "Historically, Employers who Withhold Employee's State Taxes are required, by law, to pay the State Revenue Department those Withheld monies. Employers who withheld but did not send the Employee's withheld money to the State Revenue could be charged with a Felony (Theft)."

      When the word, "Historically" is written in a sentence it generally means "in the past" - not current, not future, but past.

      3) "Notice Speaker John Boehner, Sen Mitch McConnell, and many of the Governors listed are the loudest to B!TCH about the evils of welfare! This IS Corporate Welfare and Corporate THEFT of Employee's Money."

      No matter if there is a corrupt law allows the Corps to keep employee's Tax money, it is still THEFT by the fact that the money is earmarked as a State Tax for Public Projects - not earmarked as a "GivAway" to the employee's Corp employer.

      I think this is really, theft by deception - because the lawmakers and the Corporation are going out of their way to keep the employee in the dark and going so far as actually having the employee "think" their (employee's) money is going to the State Tax Fund.

      Yeah, so - corrupt laws that benefit only large Corporations and not "mom&pops" is not only an unfair business model - it is also "theft by deception."

      I guess "Theft by Deception" is fine with you, so long as it was written by lawmakers ...

      •  VClib is correct, and the diary is codswallop. (1+ / 1-)
        Recommended by:
        erush1345
        Hidden by:
        keepemhonest
        •  your comment is absurd - but you knew that already (0+ / 0-)
        •  your comment is absurd - but you already knew that (0+ / 0-)
          •  keepemhonest - johnny has the benefit (1+ / 0-)
            Recommended by:
            erush1345

            of being a tax lawyer, a level of expertise that cc, you, and I lack.

            "let's talk about that"

            by VClib on Tue Apr 17, 2012 at 01:22:28 PM PDT

            [ Parent ]

            •  then johnny is not a very good tax lawyer (0+ / 0-)

              as johnny has missed the obvious fraud.

              to quote the former IRS worker who posted on here, GustavMaher:

              I completely agree with you [cc] that this is some kind of fraud.

               The W-2 shows state tax withheld. If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses. If the money is not sent to the state, I should be able to sue to get that money back.

              I also agree that IRS could sue the employee because they entered state tax as a way to reduce federal tax. If the state tax is not paid to the state then you have falsified your federal return.
              Whoever thought this up is a fool.

        •  The W-2 shows state tax withheld. If that money is (0+ / 0-)

          not sent to the state, then that is fraud.

          Johnny, You seem to have the same problem VCLib has - you don't read, yet you post.

          One of the best comments I saw on here is from GustavMahler who wrote:

          "I completely agree with you [cc] that this is some kind of fraud.

          The W-2 shows state tax withheld. If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses. If the money is not sent to the state, I should be able to sue to get that money back.

          I also agree that IRS could sue the employee because they entered state tax as a way to reduce federal tax. If the state tax is not paid to the state then you have falsified your federal return.
          Whoever thought this up is a fool.

          I think that comment from Gustav says it all ...
          •  It's money credited to the taxpayer's account. (2+ / 0-)
            Recommended by:
            blindcynic, erush1345

            the W-2 shows the employee's credits.

            Here's the ORC section stating which payroll tax can be withheld:

            (1) “Income tax revenue” means the total amount withheld under section 5747.06 of the Revised Code by the taxpayer during the taxable year,
            Section 5747.06, in turn, requires withholding for Ohio state income tax.  Putting all that together, the credit is for the amount of Ohio state income tax that the employer withholds and remits to the state.

            I don't think I've seen this much idiocy in a DKos diary in awhile.  It's almost impressive how badly the relevant laws are being misconstrued.

            •  w2 does not show employee credit w2 show deduction (0+ / 0-)

              do you just make up BS as you type?

              W-2 do not show employee's "credits"

              W-2 shows employee's deductions from wages.

              How many times do you have to be told, under these corrupt laws the Corp employer is does not "remit" the employee's state taxes to the state.

              Read this KY Law (kentucky was a state listed in the Diary)

              141.310 Withholding of tax from wages paid by employer.
              (16) The Commonwealth may bring an action for a restraining order or a temporary or permanent injunction to restrain or enjoin the operation of an employer's business until the bond is posted or the tax required to be withheld is paid or both. The action may be brought in the Franklin Circuit Court or in the Circuit Court having
              jurisdiction of the defendant.
              Effective: June 26, 2009
              The Employee's w-2 shows state tax withheld (not credit). If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses
            •  johnny - I am ready to end this discussion (0+ / 0-)

              how about you?

              "let's talk about that"

              by VClib on Tue Apr 17, 2012 at 01:52:37 PM PDT

              [ Parent ]

              •  VCLib -typical reply from some1 who has no clue (0+ / 0-)

                what you are talking about.

                You and Johnny here seem to be the only two who don't see this corrupt law as perpetrating fraud on the employee and the residents of those states.

                Even though Employee W-2 says is Deducted as State Taxes but not used as State Taxes is Fraud.

                State Taxes pay for a lot of things: education, state police, roads, bridges, etc

                Again, since the money Deducted as "State Taxes" is not being used as State Tax money is supposed to be used then the employee is being defrauded as are those residents relying on State Tax money for: education etc

                Seriously, how is it that you don't understand that very obvious fact.

                See if you can understand if you re-read Gustav

                The W-2 shows state tax withheld. If that money is not sent to the state, then that is fraud. You took money out of my paycheck under false pretenses. If the money is not sent to the state, I should be able to sue to get that money back.

                I also agree that IRS could sue the employee because they entered state tax as a way to reduce federal tax. If the state tax is not paid to the state then you have falsified your federal return.
                Whoever thought this up is a fool.

                •  keepemhonest - it's not fraud if the (0+ / 0-)

                  company and the state have a contract that details the financial arrangement between the two parties. How hard is this to understand?

                  "let's talk about that"

                  by VClib on Tue Apr 17, 2012 at 02:17:06 PM PDT

                  [ Parent ]

                  •  Legal Definition of Fraud illustrates Your Wrong (0+ / 0-)

                    now apparently you have a hard time processing what you read - so you might want to re-read this post a few times to 'get it' and to "understand it"

                    First:
                    The W-2 shows State Tax Withheld, but State Tax is not being withheld as the monies withheld are not being used for the same purpose as "State Taxes" are used.

                    Second:
                    Legal Definition of Fraud:

                    A false representation of a matter of fact—whether by words or by conduct, by false or misleading allegations, or by concealment of what should have been disclosed—that deceives and is intended to deceive another so that the individual will act upon it to her or his legal injury.
                    Some Components of Legal Fraud:
                    Fraud must be proved by showing that the defendant's actions involved five separate elements:
                    (1) a false statement of a material fact.  
                    -Here the material fact is the w-2.

                    (2) knowledge on the part of the defendant that the statement is untrue.
                    - Here the "Defendant" committing the Fraud would be both the Corp.
                    -Here the "statement that is untrue" is the part of W-2 that says "Deduction for State Taxes"

                    (3) intent on the part of the defendant to deceive the alleged victim,
                    - Here defendant is both Corp & the Law
                    - Here the "intent to deceive" is by the Corp falsely claiming on the employee w-2 that "Deduction is for State Taxes"

                    (4) justifiable reliance by the alleged victim on the statement,
                    -- Here the employee is relying on the w2 to be factual and is relying on the notion that if the w2 says Deduction for State Taxes is actually deduction for State Taxes.

                    and (5) injury to the alleged victim as a result.
                    -Here many injuries could be listed but off the top of my head .. the injury is:
                    ... Employee's Deducted State Tax Money was not used as State Taxes so the employee's child's school was shut down.

                    ... Employee's Deducted State Tax Money was not used as State Taxes so the employee's roads and bridges they travel on are crumbling

                    ... Employee's Deducted State Tax Money was not used as State Taxes so State Police are laid-off and the employee's safety is at risk.

                    The mere fact that the employee thinks, and is told via w2 that the money deducted is intended to be used as State Tax Money and Fund Public Projects but is not being used for Public projects but rather Private Profit is Fraud --- legally it is fraud against the employee.

                    Third:
                    The employees think they are funding the State Tax Fund - but they are wrong.

                    Fourth:
                    The residents think those employees are helping to fund the State Tax Fund - but they are wrong.

                    The only way this is not fraud against the employee is if the w2 says:
                    Deduction for Corporate Kickback.

                    Now, if you don't understand - try re-reading this post a few times and I'm sure you will finally get it.

                  •  looks like u don't understand "who" the parties ar (0+ / 0-)

                    the two parties are:
                    1) the Corporation and

                    2) the employee.

                    This Diary explains that the two parties are the Corporation and the employee.  This Diary, and the link this Diary gave, both state that the employee does not know

                    Therefore, even by your logic, fraud is being perpetrated on the employee as ... there has been on agreement between the employee and the corporation for the corporation to divert the employee's State Tax Withholding into the corporation's private funds.

                    The employee is told via w2 Deduction is for State Taxes - thus no 'agreement'

                    Like I have been telling you & Johnny - the fraud is against the employee (not the state)

                    This Diary implies fraud is against the employee, not the state.

                    Recap
                    2parties are the corp & employee - the employee is being lied to via w2 form

                    •  keepemhonest - let the employees try and sue (0+ / 0-)

                      They have no damages and the suit will be tossed out on summary judgement. The state won't pursue this because, ah yes, the state is a party to the contract. This is an issue between the state and the company. The company had no affirmative requirement to notify the employees. The state has given the employees full credit for their tax withholding, even though the state did not receive the cash.

                      "let's talk about that"

                      by VClib on Tue Apr 17, 2012 at 04:12:55 PM PDT

                      [ Parent ]

  •  It's nasty, ugly, corporotocracy (5+ / 0-)

    ..but the companies aren't breaking any laws.

    Because the legislatures wrote the laws and the governors signed them for the benefit of the companies as a bribe in order to keep the jobs from going to another state or offshore.

    Describing the funds withheld as state tax on the W2s is Orwellian, but legal.

    The only "left" the Democrats have given us is the last couple of decades is a Southpaw President

    by Anthony Page aka SecondComing on Tue Apr 17, 2012 at 10:17:45 AM PDT

  •  un-freaking-believable..... (1+ / 0-)
    Recommended by:
    keepemhonest

    sigh... I can't stand anymore...

    "It is horrifying that we have to fight our own government to save the environment." *Ansel Adams* ."Even if you are on the right track, you'll get run over if you just sit there."*Will Rogers*

    by Statusquomustgo on Tue Apr 17, 2012 at 10:25:11 AM PDT

  •  Of course the employee's tax account is (3+ / 0-)
    Recommended by:
    blindcynic, erush1345, VClib

    credited w/ the amount.  This is a ridiculous diary.

    •  And you know this ... how? (0+ / 0-)
      •  Because I'm not an imbecile and have a modicum (2+ / 0-)
        Recommended by:
        erush1345, VClib

        of common sense.

        But for those that may be imbeciles or don't have common sense, please see this description from the Ohio Dpt of Development:

        The program provides a refundable tax credit against a company's corporate franchise or income tax based on the state income tax withheld from new, full-time employees.
        IOW, the corp is credited w/ the amount of payroll taxes that they take in from the employee.  Or: the employee's payroll taxes are remitted to the state, and the corporation gets a credit in the amount of those payroll taxes.

        It's a transfer from the state to the employer, not from the employee to the employer.

        •  um ... seems you might just be an imbecile as you (0+ / 0-)

          your cut/paste proves what cc said in this Diary - your cut/paste shows the transfer is not supposed to be from the employee to the employer; however, the laws written by these corrupt lawmaker do, in fact, have the transfer go directly from the employee and directly to the employer never making it to the state revenue dept.

          you wrote:

          IOW, the corp is credited w/ the amount of payroll taxes that they take in from the employee.  Or: the employee's payroll taxes are remitted to the state, and the corporation gets a credit in the amount of those payroll taxes.
          It's a transfer from the state to the employer, not from the employee to the employer.
          but you're wrong - the "employee's payroll taxes are not remitted to the state."  Didn't you read the Diary, the Corps never send the money in.

          Your last sentence is completely false and further proof you did not read the Diary - The Transfer is from the employee to the employer

          Really, all you've done is prove cc's point because your cut/paste shows the transfer is not supposed to be from the employee to the employer.

          •  for starters, it really doesn't matter whether (2+ / 0-)
            Recommended by:
            erush1345, VClib

            they're remitted to the state and then credited back to the company, because the economic effect is the same: the employee's withholdings are credited to her account with the state revenue department and the state is short an equal amount.

            That said, some states do actually require remittance followed by credit, while others skip the middle step.

            But why does it matter?  The employee is getting withholdings properly credited (ie, it's not fraud), and the state is paying a credit to the employer.

            Yeah, it's bad policy, but fraud?  That's just fucking stupid.

            •  asdf (1+ / 0-)
              Recommended by:
              VClib

              from the actual report:

              The programs work in various ways. Some allow employers to immediately retain (and never
              remit to the state) a large portion of the withholding taxes generated by designated new or
              retained workers. Some provide cash rebates or grants calculated the same way. Others
              provide credits against corporate income taxes or other business levies, with the value of those
              credits based on the withholding taxes of new or retained workers. (Some of these credits are
              cash‐refundable if the credit exceeds the company's tax liability.)  
            •  did u say "econ effect is the same" HA HA HA (0+ / 0-)

              No, you are wrong --- completely wrong.  The economic effect is 180% different.

              Economic Effect Not the Same:

              As Eric Nelson wrote:
              The employee & all citizens of the state were hurt by the loss of revenue caused by the increasing tactic of the manufactured threat of "job piracy" - blackmail in essence
              Also, economic effect not the same as illustrated by TBug
              In other words, that means a huge paycut for those employees and no money towards maintaining the public infrastructure that those employess depend upon. Piratization anyone?
              Also, economic effect not the same as illustrated by cc:
              While loyal, neighborhood mom & pop shops struggle to pay Employee Taxes quarterly, State Governors and Legislators have a quiet "deal" that allows Large, profitable Corporations to steal their employee's money for Private Profit.
              Johnny, do you know State Taxes are to go for Public Projects and not Private Profit?

              Also, economic effect not same as illustrated by cc:

              That means, Employee Taxes, that are supposed to be used to Fund Public Projects have been DIVERTED to Private Corporations for Private Gain
              Also, economic effect not the same as illustrated by Pulitzer Prize Winner David Cay Johnston:
              "$47 million of state income taxes withheld from its workers’ paychecks, a drain on public finances that did not create any jobs, but does enrich the Wall Street firms that own AMC including arms of J. P. Morgan, Apollo Management, Bain Capital and the Carlyle Group. AMC declined to answer my questions.
  •  In other words, that means a huge paycut.. (2+ / 0-)
    Recommended by:
    keepemhonest, duufus

    In other words, that means a huge paycut for those employees and no money towards maintaining the public infrastructure that those employess depend upon. Piratization anyone?

    •  Money is Fungible (0+ / 0-)

      makes no difference what the paperwork says. If the employee is credited with paying taxes, end of story. If the state (legislature/ governor) strikes a deal with a particular company to stay in-state / move to state, the price of that deal comes off the top of the state budget, no matter what the accounting chain-of-custody says. End result is the same. State give a company tax preferences, individual employees get credit for paying in state income taxes, general fund is smaller.

      Just part of the deal to keep a company in the state and people employed. Don't like it? Vote in a different legislature. That's how representative democracy works. Get over it.

      Without geometry, life is pointless. And blues harmonica players suck.

      by blindcynic on Tue Apr 17, 2012 at 01:24:22 PM PDT

      [ Parent ]

  •  Wow, what a crazy slug-fest this thread is! nt (0+ / 0-)

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