Taxable Vs. Non-Taxable Fringe Benefits

Author: Steven D. Mercatante

Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2028 to receive credits. NOTE: Go to My Professional Profile in your CCH CPELink account settings to ensure your name, and PTIN number; matches your PTIN card

Employee expense reimbursements are subject to IRS guidelines and can be disallowed as expenses – and even considered compensation to those employees – if not handled correctly. Further, if employee expense reimbursements do not meet IRS guidelines, they may be disallowed as expenses and considered compensation to those employees, leaving the employer responsible for the associated payroll taxes – plus any penalties.

Taxable and nontaxable fringe benefit are scattered throughout the Internal Revenue Code. Benefits can be hid in Sec 274, 162, 119, 132, 127, and 82. Add in numerous Announcements, Notices and Regulations and we have a complex web. This course will concentrate on the development of an Accountable Reimbursement Plan under Sec 274 and accompanying regulations plus recent pronouncements and inflation increases.

Publication Date: April 2025

Topics Covered

• IRS Focus: The Tax Gap
• What's New: 1099 Changes
• The New April 2025 Form 1099-NEC
• Overview
• Fringes and Reimbursements Issues
• Accountable Plans
• Fringe Benefit/Expense Reimbursement Record Keeping
• Transportation Reimbursed Expenses

Learning Objectives

• Identify taxable and non-taxable wages
• Identify what other benefits are nontaxable wages
• Identify what meals are deductible and nontaxable to employees
• Identify the difference between taxable and non-taxable wages
• Identify whether meal allowances are nontaxable
• Identify when travel allowances are nontaxable
• Identify other benefits that can be nontaxable wages

Level
Basic

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
None

Advance Preparation
None