Wall Street Journal Quotes James Salles and Richard Skillman on AT&T Corporate Tax Savings

The timing of AT&T Inc.'s pledge this week to give $1,000 bonuses to more than 200,000 workers once President Trump signs the tax overhaul mayhave saved it $28 million.

"Most corporate taxpayers would be better off with a 2017 tax deduction than a 2018 tax deduction," said James Salles, a tax attorney at law firm Caplin & Drysdale in Washington.  "They would not want to needlessly complicate their entitlement to a deduction by saying something that would make it seem contingent on something that might not happen by the end of the year."

Tax attorneys say that similar determinations are likely being discussed around the U.S., as companies figure out whether to make charitable contributions or ordinary business purchases like equipment and supplies in 2017 or 2018.  If the amount is fixed and the commitment is made by Dec. 31, accrual companies are on firmer ground claiming the bigger deduction.

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"We have companies who are rushing to get those bonuses accrued this month, because it's 35% of whatever vs. 0% if it's over $1 million next year," said Caplin & Drysdale's Richard Skillman, who served as deputy chief counsel of the Internal Revenue Service under President George W. Bush.

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Excerpt taken from the article "Timing Is Vital as Companies Set Bonuses, Spending Befoe New Tax Law" by Theo Francis for The Wall Street Journal.