So...If I was an F/O and made $104,000. Those numbers would be real good?

Widebody FO's don't make 104k, unless they don't work. And if that's the case, I'm sure that they can come up with plenty of other deductions to make sure they fall into the 25% or 15% tax bracket.

You guys can complain and whine all day long, it doesn't change the fact that the tax equalization package can work for everybody as long as you understand and apply it accordingly.

Lighten up, Francis.

I don't think you saw me whining about it. I just wanted to see how many calculations you'd do.

Problem with your statistics is you assume the exclusion is the only deduction that the pilots will have.

Second problem, no one doubts that tax equalization is a good thing (especially if you are senior, especially in paris). We just want access to the numbers so we can make an informed vote, I mean an informed decision on whether to bid an FDA. Right now the only ones who can make that decision are MEC members because they are the only ones briefed on the PWC program.

Depends on the state from which they were relocated to Hong Kong. Run those numbers on a person relocated from California.

Also, consider the number of Purple Eggrolls who will be there on first year pay.

That assumpton might not be so safe afterall.:(

So how 'bout if I have to sell my house to go (that I haven't owned for 2 years yet) will I still have to pay capital gains? What if I rent it out for a loss, is that tax deductible?

All the fancy figuring is useless without some real answers to personal situations. Answers we couldn't get during LOA voting. Just like all the other unanswered questions on this POS.

I'm still bidding it.

I probably won't hold it though because I'm not in the top 68% of the seniority list that thinks that it's such a smoking deal. :rolleyes:

Sitting in the JAL lounge in Narita. Been traveling for 20 hours now and have about 5 more to go. I'm trying to grasp what you're saying. I just have one question. Did you include the deduction you get on the money paid in taxes to the HK government in your calculation?

since when is a good deal mandatory? I would think the HKG tax equalization can be a bad deal for some in order to subsidize the Paris tax equalization for an overall cost neutral or gain by the company

I'm still not convinced. Your numbers don't take into account your reduced US tax obligation based on paying foreign taxes. I'm no tax expert, but the following from the IRS website seems like it could be a big player:

If you paid or accrued foreign taxes to a foreign country on foreign source income and are subject to U.S. tax on the same income, you may be able to take either a credit or an itemized deduction for those taxes. Taken as a deduction, foreign income taxes reduce your U.S. taxable income. Taken as a credit, foreign income taxes reduce your U.S. tax liability. In most cases, it is to your advantage to take foreign income taxes as a tax credit.

Here's some answers to the aforementioned questions:

1. What about deductions?
No deductions were accounted for in the above examples. Deductions are everyone's friend, but in order to get the best advantages from them, you need to figure out (preferably with a CPA) what your deduction estimates will be and how they correlate to your respective tax bracket(s).

2. Capital gains?
If you decide to sell your house under 2 years, of course you are susceptible to capital gains.

3. State relocation
As you know, state taxes vary tremendously. I don't see where relocation from one state has any bearing on your tax burden. For example, if you change residence on Jan 1, 2008, you have "zero" tax liability to any state for the 2008 tax year. Now if you move on April 1, 2008, you still will be obligated to pay 3 months of state tax (if your state has an income tax). Same thing goes for excise taxes.

4. New hires in Hong Kong
Let's look at 50k during your first year. We'll run generic numbers for a single and also married filing jointly.

30,650 74,200 4220.00 plus 25% of the amount over 30,650
50,000 - 30,650 = 19,350 * .25 = 4837.50 + 4220.00 = 9057.50

Now use the exclusion,
50,000 - 50,000 = 0, so your U.S. tax burden is 0.
Hong Kong = 50,000 * .16 = 8000.00

So comparing the two for a single, would be a 1057.50 disadvantage for tax equalization. Now you'd have to bring deductions into the mix to try and get your 19,350 lower to make up the difference.

Married Filing Jointly
15,100 61,300 1,510.00 plus 15% of the amount over 15,000
50,000 - 15,000 = 35,000 * .15 = 5250 + 1510 = 6760.00

Now use the exclusion,
50,000 - 50,000 = 0, so your U.S. tax burden is 0.
Hong Kong = 50,000 * .16 = 8000.00

So comparing the two for married filing jointly would be a $1240 advantage for using tax equalization.

**** Conclusion ****
Overall, deductions will affect your overall tax status using either the tax equalization or the tax exclusion method. The only point I'm trying to make here is that every pilot's tax situation is going to be different, as we have real estate brokers, accountants, lawyers, S corporations, partnerships, and million other iterations of other income. Being cognizant of how this will work for you is of critical importance. In my opinion, relying on the union to provide you with examples of how this works is outside of the scope of the union. Run your own numbers using samples of your past tax returns and see where they fall. That is going to be the closest estimation you can make.

About the above post, consult your CPA, because you are correct.