Reporting of Taxable Fringe Benefits Fringe benefits>$ 2000 Reportable fringe benefitsIncluded on employees payment summaryShown on employees tax return
Tax consequences RetirementEmployee’s compensation employees’ taxable income
Group term life insuranceProvided by employers Additional taxes deducted from employee’s paychecks =>Additional income
Tax consequences in BusinessUnsubstantiated Business ExpensesReimbursement may have unexpected taxconsequences.Moving Expense Reimbursementexpenses may be deductible yet excluded fromwages in certain situations
E.g:-Employer consequences: The moving expensesare deductible and are not treated as wages.- Employee consequences: The movingexpense reimbursement is nontaxable but themoving expenses are not deductible.
ReferencesLeibowitzA., (1983), Fringe Benefits in in EmployeeLeibowitz A., (1983), Fringe Benefits Employee Compensation. .from Compensation from http://www.nber.org/chapters/c7385.pdf http://www.nber.org/chapters/c7385.pdfMONEY MANAGEMENT (2003), fromMONEY MANAGEMENT (2003), from http://www.lifetimefp.net/Advice110301.htm http://www.lifetimefp.net/Advice110301.htmRobert W Ditmer (January, 2010),Taxation of of GroupRobert W Ditmer (January, 2010),Taxation Group Term Life Insurance. From http://suite101.com/article/taxation- Term Life Insurance. From of-group-term-life-insurance-a188109 http://suite101.com/article/taxation-of-group-term-Taxable Fringe Benefit Guide (January, 2012), from life-insurance-a188109Taxable Fringe Benefit Guide (January, 2012), from http://www.irs.gov/pub/irs-tege/fringe_benefit_fslg.pdf http://www.irs.gov/pub/irs- tege/fringe_benefit_fslg.pdf