iPhone = iTax: Apple Employees Will Have to Pay IRS for Steve Jobs' "Gift"

Apple has announced that by the end of the month it will give its 18,000 full-time U.S. employees a free 8-gigabyte iPhone (retail price: $599).  Apple has not said whether it will also pick up the cost of the wireless plan (two-year contracts start at $59.99).  The tax angle?  Apple will have to include the $599 on the employees' W-2s as taxable compensation, and the company will have to pay employment taxes on the amount as well.  (Hat Tip:  TaxGirl.)  Press coverage:   Reuters, San Jose Mercury News & ThinkSecret.  For a related story, see Tax Consequences of Microsoft's "Gift" of Laptops to Bloggers and TaxGirl's coverage.