1. Fringe Benefits
IRS Publication 15-B

2. Supplements C-E What are Fringe Benefits?
Form of Pay for or related to Services
Does not have to be your employee
Subcontractor
Family member of employee
Client
You are the provider of the Benefit
You may or may not be the DIRECT provider

3. Taxable?
Any benefit that is provided IS taxable unless specifically excluded by law
Cash or Cash Equivalents are ALWAYS Taxable
De Minimus may not apply due to frequency or expectation – Thanksgiving Turkey
Value is Fair Market Value or the amount paid – whichever is greater

4. Cafeteria Plans
Written plan that allows your employees to choose between receiving cash or taxable benefits instead of certain qualified benefits for which the law provides an exclusion from wages.
Accident and Health Insurance Plans
Adoption Assistance
Dependent Care Assistance
Group Term Life Insurance
Health Savings Accounts for Long term care insurance premiums

5. Taxable or Not?
If certain conditions are met the fringe benefit provided may not be taxable.
DOCUMENTATION is a must
Authorization is a must
The following examples are limited and further review might be needed.

6. Fringe Benefits not Taxable - IF
Achievement Awards
Athletics Facilities
De minimis **
Educational Assistance - up to $5250 per year
Employee Discounts
Employer Provided Cell Phones
Lodging on premises

7. Fringe Benefits not Taxable - IF
Meals
Moving Expense Reimbursement - meals not included
No Additional Cost Services **
Transportation Benefits - local travel, transit pass
Tuition Reduction - educational organization only
Working Condition Benefits - property/services provided to employee so they can perform their job

8. De Minimis Cash or Cash Equivalents are always taxable!
Occasional Personal use is not taxable
Holiday gifts with low fair market value
Meals - low fair market value and infrequent or for employer convenience
Occasional Parties and Picnics for Employees and families
Occasional tickets that do not meet the No Additional Cost

9. No Additional Cost
Services provided to employee that doesn’t cause the employer any substantial additional costs
Tickets due to excess capacity (airline, bus, etc.)
Athletic Facilities
Employee Discounts – 20%

10. Exceptions Employer Provided Cell Phones Meals
Need to contact employee
Requirement to be available to clients
Meals
Occasional or of little value
For convenience of employer

11. Exceptions Lodging on Your business premises
Furnished on your business premises
Furnished for your convenience
Must accept it as a condition of employment
Different Test Apply to Educational Institutions – Section 119(d)
Does not apply if the employee has a choice to receive Lodging or pay in lieu of

12. Vehicles/Cell Phone Lease FMV Car Stipend Cell Phone
Mileage Log must be maintained
Reportable and Personal Use is taxable
Car Stipend
Set amount each month.
Taxable
Cell Phone
Taxable Cash stipend
Parking - $ per month, Transit passes - $130.00

13. Disclaimer
This presentation is not intended to be all encompassing but only an overview of some of the items/situations that arise and is for discussion purposes only.
For a more detailed analysis of a particular situation please feel free to contact me at any time.
Andrea Scheuering
Thank you for attending!