> isn't even paid for her labour...
The IRS considers payment in kind (goods in exchange for services) to be taxable income. [0] So, I’d say she’s getting paid.
The IRS considers payment in kind (goods in exchange for services) to be taxable income. [0] So, I’d say she’s getting paid.
1) Buy product - taxable expense for business/work purposes 2) Write review 3) Get sent money equal to purchase price - taxable income
Net, the money cancels out to no taxable income but she has the product. It was bought with her own money and still belongs to her.
It's like if I run a blog, I bought a new PC to do my blogging (business expense), wrote about how nice it was, then the company sent me some money or a gift as thanks. I wouldn't have to pay tax on the PC if this happened.
See also Gregory v. Helvering (U.S. 1935) for the quintessential example of this principle. https://en.wikipedia.org/wiki/Gregory_v._Helvering
I find this interesting in your link:
"if a transaction has no substantial business purpose other than the avoidance or reduction of Federal tax, the tax law will not regard the transaction"
I don't see how that doesn't apply to all the shuffling we see from big corps these days, licensing things they own to companies they own just to shift profits. Though that's another tangent.