Intlpilot

TonyC

Thought your comments at the meeting last week were spot on and thanks for stepping up. You and Wes took a beating! Good for both of you defending the position. If people in that meeting could not read between the lines and make a good decision . . . it's amazing they have a vote.

The only thing I took offense to was the normal Chris Baker pushing responsibility off on someone else. . . . The company may have said they would take care of explaining the tax equilization, but I pay dues to the union. It is ultimately the union's responsibility to make sure I understand that every thing is explained to me.

This is going to be a close one!

Underdog

Many pilots keep reminding me that if I don't want the "enhanced" option of the LOA, I can take the current CBA. One problem with that. Should the LOA pass, the benefits of the CBA are drastically altered. Hear me out, please. Under the LOA, a new term which few pilots fully understand is added to the language should you choose the current CBA package. That is tax equalization. We have all heard the company and the NC say this is good. I claim it's a necessary tool to help companies defray the enormous costs of providing their employees full expatriate packages. Unfortunately, that's not the case with this LOA.

Every US citizen, upon establishing residency abroad(~1 year) is entitled to the foreign earned income exclusion. This is not a "one time good deal" for the SFS folks. It's the right of every pilot who will be living in HKG or CDG, period. That exclusion basically states that the first $82,400 you earn, is done so, tax free. Go ahead and figure how much that is worth to you. With tax equalization, the pilot still qualifies for the exclusion, and PW will complete your taxes with the exclusion. Only the money saved due to the exclusion goes to the company, of course they claim it goes to"stay-at-home(Hypothetical) income. That sounds better than saying they are keeping it. Next, the pilot must pay taxes as though they live in the US. We pay, but guess what? The IRS doesn't collect that, because it's not really owed as far as they're concerned. So the amount you got for the exclusion approximates(based on individuals write-offs) what you will have to pay. PW files and the company gets that money as well. Lastly, foreign taxes paid are a direct write-off on your US returns. Yes, if that amount is provided, that is additional taxable income. Nonetheless, I submit anyone based in CDG would owe $0 for federal income taxes.

I have done a cursory look at the numbers as they pertain to me living in HGK, and I would also owe little, if any, federal taxes. The total of the exclusion, paying taxes, "as though I live stateside," and not getting the write-off for foreign taxes, equates to over $55,000! Yes, "the LOA also provides tax equalization, which could be worth five figures alone depending on your seat and base." True statement, but worth it to whom? My tax obligation in HKG would be no more than $38,000, the company wants to "give" us $2700/month($32,400/yr) in housing allowance. Tax equalization is HUGE indeed, for the company. We are subsidizing our own foreign taxes and housing allowance!

Finally, under the company's question and answer segment on their explanation of tax equalization, someone asked "how does the overseas assignment affect my state and local income taxes?" The company's response was "...as determined under the laws of the tax jurisdiction the overseas employee was relocated from." Currently, SFS pilots are considered to have relocated from the place where household goods were picked up and shipped from. I haven't heard any clarification on this. So a pilot may have to pay state taxes to boot...brilliant! Then, the company would surely pay $0 and claim they are paying foreign taxes and giving us a $2700 housing allowance, when in fact, the pilot is paying.

vagabond

I'm pretty sure the LOA was drafted in large part by a team of very highly paid lawyers, each of whom graduated top of the class from Harvard or Yale and was Editor in Chief of one publication or the other. FedEx has a formidable team working for it. Do not be lulled into thinking otherwise.

The MEC (and the entire pilot group) is lucky to have Tony, who, for all intents and purposes, thinks and behaves like a good lawyer. His analytical and critical planning skills are far superior to any law review student I've ever taught and mentored.

I'll continue to observe the situation from APC and other avenues. Makes for a wonderful learning opportunity with the interplay of contract law, labor law, international law, tax law and perhaps even human rights law.

MaxKts

Please Explain

Huck

And yet we reject his advice.....

"My name is at the bottom of the Majority Opinion and the LEC 22 Update -- both describe my position accurately. " - Tony, 7/27

kc10/c130

You are correct. Do not vote out of fear. Did I hear right, Albie is Auburn. I'm so disappointed.

Too many questionable variables that the company won't step up on and that is a shame. What is even worse is they are, in my wifes words, playing questionable politics.

Sorry, no. Please go back and try again.

Huck

I have as much respect for Albie as I do for Tony. Albie and I were at Auburn together and my admiration for him goes way back. A man-crush, in fact.

Two quotes keep running through my head about this LOA debate:

1. Robert Estabrook: He who has learned to disagree without being disagreeable has discovered the most valuable secret of a diplomat.

2. Dwight Eisenhower (I think): I will question a man's actions, but not his motives.

USNA84

"It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat."


Theodore Roosevelt

USNA84

"...the man who really counts in the world is the doer, not the mere critic-the man who actually does the work, even if roughly and imperfectly, not the man who only talks or writes about how it ought to be done."

Theodore Roosevelt

Check 6

"Vote NO"

Check Six