Remember when we had a discussion about this letter that most involuntary furloughs received in Oct. 2003.
October 21, 2003
Dear US Airways Furloughee:
When you left US Airways, the company was pleased to offer you travel privileges for a defined period of time as part of your furlough package. However, due to tax law, we are required to begin to tax the value of your space available travel. Therefore, beginning November 1, 2()03, for travel occurring after October 31, 2003, we will impute taxable income for space available travel by all involuntarily furloughed employees (and eligible family members) who have been on involuntary furlough status for more than one year and continue to have travel privileges.
How Does Imputed Income Work?
As required by the Internal Revenue Code, Section 6 1(aX I), you will be deemed to have received taxable income on the fair market value of any travel occurring after October 31, 2003. The current fair market value is considered to be 10% of the highest, unrestricted US Airways coach class fare available for sale on the date of travel. This is consistent with our valuation for companion passes, the domestic partner program and other programs.
As an example, if you were to travel from Washington, D.C. to Los Angeles through Pittsburgh, the imputed income on your travel would be calculated as follows:
DCA-PIT Y-8 fare is $400 and 10% of that fare is PIT LAX Y-8 fare is $800 and 10% of that fare is
Total Imputed Income
Total Tax Liability at 28% rate
$ 40.00
$ 80.00
$120.00
$ 33.60*
* This example assumes a tax rate of 28%, but the federal and state income taxes on this amount of imputed income will vary depending on your tax bracket, and your rate will ultimately determine the amount of tax you will be responsible for. The fares in this example are approximate and for illustrative purposes only.
In January of each year, if the value of your total travel exceeds $600, you will receive a Form 1099 from the Company that will reflect the taxable income to you for the travel by you and your eligible family members in the prior year. If the value is under $600, you will receive an information statement showing the taxable value. You must report this taxable income to the Internal Revenue Service on your individual income tax return.
If you have questions regarding the imputed income, a Q & A is available on theHub. Sincerely,
John M. Hedblom
Well I got my form 1099 MISC for 2004. I've done my research w/ the IRS and according to them, US Airways clasify the involuntary furloughs as non-employee's w/ the company and that is why we have to file this form if we go over $600.00. I am verifying w/ the company and the union about this and I advise the rest of you that have received this letter to do the same. Also request for a detail copy of the charges and verify that information because it maybe incorrect. There are a few errors with mines and I need someone w/ the company to fully explain what they are doing. Just wanted to give you guy’s heads up. Sounds like US Airways are trying to run a fast one on us. By the way, this only applies to involuntary.
October 21, 2003
Dear US Airways Furloughee:
When you left US Airways, the company was pleased to offer you travel privileges for a defined period of time as part of your furlough package. However, due to tax law, we are required to begin to tax the value of your space available travel. Therefore, beginning November 1, 2()03, for travel occurring after October 31, 2003, we will impute taxable income for space available travel by all involuntarily furloughed employees (and eligible family members) who have been on involuntary furlough status for more than one year and continue to have travel privileges.
How Does Imputed Income Work?
As required by the Internal Revenue Code, Section 6 1(aX I), you will be deemed to have received taxable income on the fair market value of any travel occurring after October 31, 2003. The current fair market value is considered to be 10% of the highest, unrestricted US Airways coach class fare available for sale on the date of travel. This is consistent with our valuation for companion passes, the domestic partner program and other programs.
As an example, if you were to travel from Washington, D.C. to Los Angeles through Pittsburgh, the imputed income on your travel would be calculated as follows:
DCA-PIT Y-8 fare is $400 and 10% of that fare is PIT LAX Y-8 fare is $800 and 10% of that fare is
Total Imputed Income
Total Tax Liability at 28% rate
$ 40.00
$ 80.00
$120.00
$ 33.60*
* This example assumes a tax rate of 28%, but the federal and state income taxes on this amount of imputed income will vary depending on your tax bracket, and your rate will ultimately determine the amount of tax you will be responsible for. The fares in this example are approximate and for illustrative purposes only.
In January of each year, if the value of your total travel exceeds $600, you will receive a Form 1099 from the Company that will reflect the taxable income to you for the travel by you and your eligible family members in the prior year. If the value is under $600, you will receive an information statement showing the taxable value. You must report this taxable income to the Internal Revenue Service on your individual income tax return.
If you have questions regarding the imputed income, a Q & A is available on theHub. Sincerely,
John M. Hedblom
Well I got my form 1099 MISC for 2004. I've done my research w/ the IRS and according to them, US Airways clasify the involuntary furloughs as non-employee's w/ the company and that is why we have to file this form if we go over $600.00. I am verifying w/ the company and the union about this and I advise the rest of you that have received this letter to do the same. Also request for a detail copy of the charges and verify that information because it maybe incorrect. There are a few errors with mines and I need someone w/ the company to fully explain what they are doing. Just wanted to give you guy’s heads up. Sounds like US Airways are trying to run a fast one on us. By the way, this only applies to involuntary.
