If a fringe benefit is furnished to someone other than the service provider such benefit is considered in this section as furnished to the service provider, and use by the other person is considered use by the service provider. Thus, a fringe benefit may be taxable to a person even though that person did not actually receive the fringe benefit. A taxable fringe benefit is included in the income of the person performing the services in connection with which the fringe benefit is furnished. (4) Person to whom fringe benefit is taxable. Refraining from the performance of services (such as pursuant to a covenant not to compete) is deemed to be the performance of services for purposes of this section. A fringe benefit provided in connection with the performance of services shall be considered to have been provided as compensation for such services. If the limits are exceeded or the requirements are not met, some or all of the fringe benefit may be includible in gross income pursuant to section 61. For example, many fringe benefits specifically addressed in other sections of subtitle A of the Internal Revenue Code are excluded from gross income only to the extent that they do not exceed specific dollar or percentage limits, or only if certain other requirements are met. The fact that another section of subtitle A of the Internal Revenue Code addresses the taxation of a particular fringe benefit will not preclude section 61 and the regulations thereunder from applying, to the extent that they are not inconsistent with such other section. Section 134 excludes from gross income “qualified military benefits.” An example of a benefit that is not a qualified military benefit is the personal use of an employer-provided vehicle. Similarly, the value of the use by an employee of an employer-provided vehicle or a flight provided to an employee on an employer-provided aircraft may be excludable from income under section 105 (because, for example, the transportation is provided for medical reasons) if and to the extent that the requirements of that section are satisfied. Examples of excludable fringe benefits include qualified tuition reductions provided to an employee (section 117(d)) meals or lodging furnished to an employee for the convenience of the employer (section 119) benefits provided under a dependent care assistance program (section 129) and no-additional-cost services, qualified employee discounts, working condition fringes, and de minimis fringes (section 132). Thus, if the requirements of the governing section are satisfied, the fringe benefits may be excludable from gross income. To the extent that a particular fringe benefit is specifically excluded from gross income pursuant to another section of subtitle A of the Internal Revenue Code of 1986, that section shall govern the treatment of that fringe benefit. (2) Fringe benefits excluded from income. Examples of fringe benefits include: an employer-provided automobile, a flight on an employer-provided aircraft, an employer-provided free or discounted commercial airline flight, an employer-provided vacation, an employer-provided discount on property or services, an employer-provided membership in a country club or other social club, and an employer-provided ticket to an entertainment or sporting event. For an outline of the regulations under this section relating to fringe benefits, see paragraph (a)(7) of this section. Section 61(a)(1) provides that, except as otherwise provided in subtitle A of the Internal Revenue Code of 1986, gross income includes compensation for services, including fees, commissions, fringe benefits, and similar items.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |