Although some companies that sent workers home during the pandemic have returned them to the office, many businesses continue to rely on remote workers. At the same time, companies in a range of industries are struggling to find and keep employees.
This unusual business environment has spawned some innovative fringe benefits — or expanded traditional offerings — from counseling to pizza deliveries to birthday gifts. What are the tax consequences of offering them? It depends.
"Fringe benefit" typically is used to describe services, property or some other item of value an employer provides its employees. Normally, a fringe benefit constitutes taxable income to the recipient unless a statutory exclusion applies. For some employees, the special tax-exempt perks are the real fringe benefits.
The list of statutory exclusions in the tax code includes common benefits, such as health insurance and retirement plan matching contributions. But other less-known benefits may fit your company's current needs. Here are eight to consider — and their potential tax treatment: