Taxing Gifts, Awards and Other Fringe Benefits

Live Webinar

Webinar Details $219

  • Webinar Date: May 29, 2024
  • Webinar Time: 2:00pm - 3:40pm EDT   live
  • Webinar Length: 100 Minutes
  • Guest Speaker:   Chuck Borek
  • Topic:   Taxation and Accounting, Human Resources, Compensation and Benefits
  • Credit:   CPE 2.0, ATATX 1.5, ATAPR 1.5, IRS 2.0
All Access Membership

As most employers know, wages or salary is only the tip of the iceberg when it comes to compensating employees. Not only is there a slew of withholding and payroll tax issues to contend with, compensation is rarely confined to the employee’s regular paycheck. In an increasingly competitive employment market employers are turning to various fringe benefits and other incentives to attract and retain qualified employees. In this session we will address the ins and outs of compensation that goes beyond the standard paycheck– the dos, the don’ts and the cannots.

The topics covered will include:

  • The viability of non-taxable gifts to employees
  • Definition of a fringe benefit
  • Distinguishing taxable from nontaxable fringe benefits
  • Accountable reimbursement plans
  • The multiple layers of educational benefits
  • Using ownership interests as incentive compensation
  • Requirements for incentivizing employees with achievement awards

Level: Intermediate
Format: Live
NASBA Field of Study: Accounting
Program Prerequisites: None
Advance Preparation: None

  1. Introduction
  2. What is a Gift? 00:00:59
  3. Definition of Gift 00:
  4. BUT . . . There is a Gift Tax 00:04:34
  5. Good News 00:08:27
  6. Gooder News 00:12:51
  7. Return for Taxable Gifts 00:15:18
  8. How the Unified Works 00:17:13
  9. Bad News 00:18:01
  10. Badder News 00:19:59
  11. Accretions of Wealth are Taxed! 00:20:32
  12. What is a Fringe Benefit? 00:22:53
  13. Fringe Benefit Definition 00:27:08
  14. Common Taxable Fringes - Company Car 00:
  15. Common Taxable Fringes - Vacations 00:30:02
  16. Common Taxable Fringes - Rentals 00:31:49
  17. Common Taxable Fringes - Moving Expenses 00:35:04
  18. Common Taxable Fringes - Bonuses 00:36:40
  19. Common Taxable Fringes - Gift Cards 00:37:12
  20. Taxable Fringes 00:38:39
  21. Non-Taxable Fringes 00:41:37
  22. Medical and Accident Benefits 00:45:56
  23. Meals and Lodging 00:48:39
  24. Cafeteria Plans 00:51:34
  25. Code §132 Fringes 00:53:53:18
  26. No Additional Cost Fringes 00:53:42
  27. Working Condition Fringes 00:55:51
  28. De Minimis Fringes 00:57:31
  29. Qualified Retirement Planning 01:02:10
  30. On-Premises Gyms 01:03:06
  31. Partially Taxable Fringes 01:04:37
  32. Group Term Life Insurance 01:06:49
  33. Group Life Example 01:07:09
  34. Expense Reimbursement 01:08:30
  35. Accountable Plans 01:08:43
  36. Achievement Awards 01:11:59
  37. Awards 01:12:40
  38. Employee Achievement Awards  01:13:56
  39. TCJA Definition for Employee Achievement Awards Clarified 01:15:36
  40. Gift Cards = Cash 01:16:37
  41. Education Benefits 01:17:03
  42. Tuition Remission 01:17:26
  43. Related to Current Occupation 01:19:13
  44. Flow Chart Example 01:23:23
  45. Section 127 Plans 01:25:01
  46. Incentive Compensation 01:27:02
  47. Stock Options 01:27:21
  48. Stock Options: Ordinary 01:28:45
  49. Stock Options: ISO 01:30:12
  50. ISO Requirements 01:31:01
  51. Thank You! 01:33:17
  52. Attendee Questions 01:33:56
  53. Presentation Closing 01:42:28

  • 501(c)(3) 00:14:34
  • Accountable Plan 00:51:24, 01:07:38, 01:09:01
  • Audit 00:39:28
  • Capital Gain 01:30:04
  • De Minimis 00:51:10, 00:57:31
  • Expense Reimbursement 01:08:32
  • Form 706 00:17:23
  • Form 709 00:16:12
  • Form W-2 00:29:51, 00:33:45, 00:38:44, 00:48:08, 01:08:53
  • Fringe Benefits 00:22:53, 00:28:21, 00:38:42, 00:41:37, 00:45:30, 00:57:40, 01:04:27, 01:08:55
  • Incentive Stock Options (ISO) 01:30:12
  • IRC Section 132 00:45:27, 00:57:28, 01:02:17
  • IRC Section 61 00:19:59
  • Limited Liability Company (LLC) 00:47:25
  • Ordinary Income 01:28:56
  • S Corporation 00:47:37
  • Section 125 Cafeteria Plan 00:45:06, 00:51:34, 01:25:07
  • Tangible Personal Property 01:14:04, 01:15:48
  • Tax Cuts and Jobs Act 00:35:16, 01:10:58
  • Wage 00:38:47, 01:12:57, 01:29:10
  • Working Condition Fringe Benefit 00:53:29

501(c)(3): A 501(c)(3) organization is a corporation, trust, unincorporated association, or other type of organization that is exempt from federal income tax under section 501(c)(3) of Title 26 of the United States Code. It is the most common type of the 29 types of 501(c) nonprofit organizations in the United States. (en.wikipedia.com)

Accountable Plan: An accountable plan is a plan that follows the Internal Revenue Service (IRS) regulations for reimbursing workers for business expenses in which reimbursement is not counted as income. ... However, these expenses must be business-related to fall under an accountable plan.

Audit: A formal examination of an organization's or individual's accounts or financial situation

Capital Gain: Capital gain is an economic concept defined as the profit earned on the sale of an asset that has increased in value over the holding period. An asset may include tangible property, a car, a business, or intangible property such as shares.

De Minimis: Too trivial or minor to merit consideration.

Expense Reimbursement: Expense reimbursement is a method for paying employees back when they spend their own money on business-related expenses. These expenses generally occur when an employee is traveling for business but can occur in other work-related situations. (www.thebalancecareers.com)

Form 706: Form 706: United States Estate (and Generation-Skipping Transfer) Tax Return is an Internal Revenue Service (IRS) form used by an executor of a decedent's estate to calculate the estate tax owed, according to Chapter 11 of the Internal Revenue Code (IRC).

Form 709: Form 709 is used to report to the IRS any taxable gift money that is subject to the gift tax or generation-skipping transfer taxes. The form is called the United States Gift (and Generation-Skipping Transfer) Tax Return.

Form W-2: Form W-2 is an Internal Revenue Service tax form used in the United States to report wages paid to employees and the taxes withheld from them. Employers must complete a Form W-2 for each employee to whom they pay a salary, wage, or other compensation as part of the employment relationship. - Wikipedia (https://en.wikipedia.org/)

Fringe Benefits: An extra benefit supplementing an employee's salary, for example, a company car, subsidized meals, health insurance, etc.

IRC Section 132: Internal Revenue Code Section 132(a) provides eight types of fringe benefits that are excluded from gross income

IRC Section 61: Section 61(a) of the Internal Revenue Code defines gross income as income from whatever source derived, including (but not limited to) “compensation for services, including fees, commissions, fringe benefits, and similar items.”

Incentive Stock Options (ISO): Incentive stock options, are a type of employee stock option that can be granted only to employees and confer a U.S. tax benefit. ISOs are also sometimes referred to as statutory stock options by the IRS. ISOs have a strike price, which is the price a holder must pay to purchase one share of the stock.

Limited Liability Company (LLC): An LLC is a corporate structure where members cannot be held accountable for the company’s debts or liabilities. This can shield business owners from losing their entire life savings if, for example, someone were to sue the company. Can be a single member (much like a sole proprietor) or a multi-member. It shares certain traits of both corporations as well as partnerships or sole proprietorships. It is not a corporation.

Ordinary Income: Ordinary income is any type of income earned by an organization or an individual that is taxable at ordinary rates. It includes (but is not limited to) wages, salaries, tips, bonuses, commissions, rents, royalties, short-term capital gains, unqualified dividends, and interest income.

S Corporation: An S corporation, for United States federal income tax, is a closely held corporation that makes a valid election to be taxed under Subchapter S of Chapter 1 of the Internal Revenue Code. In general, S corporations do not pay any income taxes.

Section 127 Plans: A Section 127 plan (“127 plan” or “127c plan” for short) is the official written legal document that outlines the terms of and governs a company's Educational Assistance program (EAP).

Tangible Personal Property: Tangible Personal Property Tax is an ad valorem tax assessed against the furniture, fixtures and equipment located in businesses and rental property. Ad valorem is a Latin phrase meaning “according to worth”. This tax is in addition to your annual Real Estate or Property Tax.

Tax Cuts and Jobs Act: The Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018, Pub.L. 115–97, is a congressional revenue act of the United States originally introduced in Congress as the Tax Cuts and Jobs Act, that amended the Internal Revenue Code of 1986.

Wage: A fixed regular payment, typically paid on a daily or weekly basis, made by an employer to an employee, especially to a manual or unskilled worker.

Working Condition Fringe Benefit: The working condition benefit is a type of fringe benefit employers offer employees. Working condition benefits include property and services employers provide to employees so they can perform their jobs.


Guest Speaker

  • Chuck Borek