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Conference Registration Fee Waived for Speakers

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Latest post Tue, Mar 21 2017 3:38 AM by LegalSecy. 3 replies.
  • Mon, Mar 20 2017 9:05 AM

    Conference Registration Fee Waived for Speakers

    I was invited to give a presentation at a professional conference, which is a real honor so far as I am concerned.  My presentation would be about lessons learned from managing a particularly complicated and high profile situation that occurred in the course of my employment.

    I got sign-off from my boss.  Then I had to confer with our Legal Counsel because I needed some other legal paperwork in order to assign the professional association licensing rights to videotape and re-transmit my presentation.

    On my way out the door, our legal counsel mentioned completely as an afterthought that I "may" have to pay income taxes on the $1400 value of the conference registration fee that is being waived by the organization for speakers at the conference.

    Really?  If I have to pay personal income taxes on an extra $1400 just because I'm speaking at a conference , I don't want to do it.  We don't have that kind of extra money laying around to fund my sharing of professional work experiences with others in the same field.  I dont' have to pay taxes on the travel to and from the conference (which my employer is paying for).  Why should I have to pay taxes on the waiver of the conference registration fee, which the organization holding the conference is paying for?

  • Mon, Mar 20 2017 2:01 PM In reply to

    Re: Conference Registration Fee Waived for Speakers

    When you asked the lawyer, "what do you mean by 'MAY have to pay taxes' what do you mean?" how did he respond?  Does this lawyer have any expertise in tax law?

  • Mon, Mar 20 2017 2:34 PM In reply to

    Re: Conference Registration Fee Waived for Speakers

    LegalSecy:

    On my way out the door, our legal counsel mentioned completely as an afterthought that I "may" have to pay income taxes on the $1400 value of the conference registration fee that is being waived by the organization for speakers at the conference.

    Really? 

    I assume that your legal counsel is not a tax lawyer and thus I'll give him/her kudos for spotting and mentioning the tax issue. A lot of non tax lawyers wouldn't even spot the potential tax issue here. The Association has invited you to speak at the conference in exchange for allowing you to attend the conference without having to pay the usual $1,400 conference admission fee. This is a barter situation, i.e. the exchange of goods and/or services without using cash as an intermediary. The way barter transactions are analyzed for tax purposes is to look at what it would look like if cash was used as an intermediary. Here, that means the Association would have paid you $1,400 in cash to speak at the conference and then you turned around and paid the association $1,400 to attend the rest of the conference. When viewed that way, it becomes apparent that the $1,400 speaking fee is taxable income. See IRS publication 525 which has a discussion of bartering income in it. 

    But it also means that your payment of the conference fee of $1,400 would also likely be deductible on Schedule A of your return as an unreimbursed employee expense. The problem with that is that this deduction is part of a category of deductions that are subject to a 2% limitation. What that means is that only the total of amount of the deductions you take in this category that exceeds 2% of your adjusted gross income would end up being deductible. For example, if your adjusted gross income (AGI) was $100,000 and your total miscellenous deductions subject to the 2% limitation totaled $5,000, you would end up with a $3,000 deduction ($5,000 - (2% x 100,000) = $3,000). If you do a decent amount of travel for your employer that is unreimbursed and that you deduct as an unreimbursed employee expense, or you have other deductions in the 2% category, then deducting the $1,400 might end up offsetting all of the $1,400 in income that you have. This is not quite a perfect wash because the income increases your AGI, but it would be pretty close unless you are either subject to alternative minimum tax (AMT) or the increase in AGI results in you being subject to a phase-out of some other tax benefit.

    The bottom line is that while the waived conference fee is income how much it might impact the tax you pay will depend on the extent to which you can benefit from deducting the conference fee. That will depend on the details of your tax situation.

    You could also change the arrangement so that instead of allowing you to attend the rest of the conference for free you are simply invited to speak but cannot attend the rest of the conference. In other words, getting no benefit in exchange for you speaking at the conference. If you are not getting any benefit there is no barter and no income for you. But then, you'd not get to attend the rest of that conference. It has to be clear, though, that you are not allowed to attend the rest of it. It doesn't work if they waive the fee and allow you to attend and you just decide not to participate in the conference at all. Would your employer be willing to pay the fee for you to attend the conference? That too might solve the tax problem for you.

  • Tue, Mar 21 2017 3:38 AM In reply to

    Re: Conference Registration Fee Waived for Speakers

    Thank you.  This is helpful.

    Just to play Devil's Advocate here -- why is this considered personal income to me personally rather than a benefit to my employer (who otherwise would have paid the conference fee if it were not waived)?

    As a matter of fact, if it truly is personal (bartered) income to me personally, then I am probably violating State law by accepting it because State law prohibits any personal gain to State employees (other than our regular salary and benefits) that is a result of our State employment.  This speaking opportunity is clearly as a result of my State employment, because the topic is lessons learned from a situation that arose in the course of my employment.

    So ... trying to think outside the box here ... why isn't the waiver of the conference registration fee regarded as a benefit to my employer (who otherwise would have paid for me to attend the conference) rather than a personal benefit to me?

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