The IRS recently updated one of their publications which provides details for tax rules associated with employer provided fringe benefits (Publication 15-B). Some of you may ask, what are fringe benefits and why should I take the time to understand them?
- Qualified parking is no longer deductible – qualified parking is parking employers provide employees on or near your business premises. It includes parking on or near the location from which your employees commute to work using mass transit, commuter highway vehicles, or carpools. It doesn’t include parking at or near your employee’s home.
- Commuter highway vehicle is no longer tax deductible – a commuter highway vehicle is any highway vehicle that seats at least 6 adults (not including the driver).
- Transit passes are no longer tax deductible – a transit pass is any pass, token, fare card, voucher or similar item entitling a person to ride, free of charge or at a reduced rate on one of the following:
- On mass transit
- In a vehicle that seats at least 6 adults (not including the driver) if a person in the business of transporting persons for pay or hire operates it.
It is important to stay up-to-date with these tax law changes and plan for these changes so you are not caught off-guard at year end. Please contact me should you have any questions.