Proposal On Public Service Ads - Tax Benefit

[wiseone]

Greetings,
Just had this idea running around in my... Everyone in the Adsense program is showing some amount of public service ads. I can bet that Google is getting a tax write for showing these ads. How come as publisher we are not also taking advantage of this? It would be very easy to calculate. Every visitor to your site is worth something. Here is an example of how the calculation could be done.

- You have 1000 visitors to my site per day.

- You make $10 per day on Adsense.

- $10/$1000 = Each visitor is worth .01 to your bottom line.

- On a given day, you show 100 public service ads. This means that I should be able to write $1.00 on my taxes due to my charitable contributions that I have made by allowing the public service ads of the non-profits be shown. It is similar to donating services.

This tax benefit could ad up on a site that show hundreds of thousands or millions of ad impressions per year.

The one thing missing is knowing exactly how many PSAs are shown each day.

Let me know your thoughts.

[digitalpoint]

I think you would have a hard time justifying that to the IRS. Especially since the click-though payout is completely variable and you don't know what it is.

[wiseone]

At the end of year... When you close your books, you should have the following:

- Total number of Ads served in the Google Adsense Program
- Total dollar amount earned from serving those Ads.
- Total number of PSA shown over the year.

Based on the above numbers, you should be able to get what each visitor was worth to you for the fiscal year.

It is probably a tough sell to the IRS... But what benefit do you think Google is getting out of showing the Ads? I know they probably want to be good citizens... However, it seems as though they could also have a tax advantage. They can also probably afford much better tax accountants than Turbo Tax.

[Voyager]

I am not an accountant, but...

I believe you can only write-off your expenses in what you contributed -- not the value received.

Therefore, you could only write off the bandwidth that you are paying for to call to alternative ad.

My accountant tells me that when my services company does charity work, we cannot write anything off. We can only not claim revenue that we didn't receive. Well of course we don't claim revenue that we don't receive. ;-)

[compar]

I think what you have here is a lost opportunity. You didn't spend any money. You can only argue that you could have made more.

It is the same thing if someone doesn't pay their bill. You obviously don't pay tax on the money because you never collected it, but you can't claim a tax refund because somebody stiffed you.

So you don't pay tax on the money you didn't earn because Google was running PSA, but there were no real dollars flowing out of your pocket. It was just an opportunity cost. It's like arguing that we should get a tax break for all the time we spend in forums, because if we had actually been working we could have earned a whole bunch more.

[disgust]

hah, it's an interesting idea, but I doubt it'd fly.

[4kids]

Services are non-deductible.

Sorry, wiseone, this idea doesn't work.

[respree]

I'm afraid it just doesn't work that way. It's pretty black and white.

This is a broad and over-simplified generalization, but I'll say that a corporation pays tax on its net earnings; the basic formula being revenue minus expenses.

To the extent that expenses were incurred while serving these ads, that is the extent and limit of their tax benefit.

[mopacfan]

Well, once the republicans change us over to a VAT or flat tax and eliminate the IRS, then it be a non-issue

[Abiao25]

Originally Posted by Voyager

I am not an accountant, but...

I believe you can only write-off your expenses in what you contributed -- not the value received.

Therefore, you could only write off the bandwidth that you are paying for to call to alternative ad.

I also believe it!