The IRS may dial up new rules that could cost you more in taxes if your employer gives you a cell phone.
The feds have proposed taxing 25% of business cell phone use as income.
That means someone who’s in a 28% tax bracket and whose work cell phone costs their company $1,000 a year would pay $70 more in federal income tax.
The IRS has had a law on the books regarding taxation of personal calls on business cell phones for two decades, but companies have rarely complied because of the difficulty of keeping such records.
One choice would be for employees to offer proof that they have a personal cell phone that they use during working hours. That would substantiate that the business cell phone was being used solely for work purposes.
Another option being floated would allow companies to use a statistical sampling to figure out how much of their employees’ phone bills are for personal calls.
The IRS said it is awaiting responses to its proposals from the public.