Employee Wages

kemco

LawnSite Fanatic
Location
Memphis TN
Doesn't matter what a savvy biz owner or CPA does, you the biz owner are on the hook for doing it wrong. But I won't beat that horse to death.
 

kemco

LawnSite Fanatic
Location
Memphis TN
I'm actually using those for my argument here. Quite aware of them. And quite aware of their limitations. Even though I say "my argument" I mean my reasoning as I'm not trying to argue. Just because someone, including a CPA calls something paid out a de minimus benefit doesn't make it so is my point. I've been on the wrong side of the IRS. Doesn't matter what the CPA did as you the business owner signed off on it. Lots of CPAs are wrong or mischaracter items, maybe not on purpose but maybe so hoping you aren't audited.
 

grass man 11

LawnSite Bronze Member
Perks are actually cheaper than their cash equivalent

if you pay for perks they’re just as deductible but you don’t pay workers comp or taxes/payroll matching on those dollars
Also the employees get those bennies they don’t pay taxes on it either
That depends on the benefit, and technically all benefits are suppose to be taxed. Not that really it happens
 

cool breeze

LawnSite Senior Member
I'm actually using those for my argument here. Quite aware of them. And quite aware of their limitations. Even though I say "my argument" I mean my reasoning as I'm not trying to argue. Just because someone, including a CPA calls something paid out a de minimus benefit doesn't make it so is my point. I've been on the wrong side of the IRS. Doesn't matter what the CPA did as you the business owner signed off on it. Lots of CPAs are wrong or mischaracter items, maybe not on purpose but maybe so hoping you aren't audited.

The IRS limitations on de minimis benefits is pretty much well defined. I’ve been audited as well but that hasn’t stopped me from legally taking advantage of these benefits and believe me, my guys appreciate them. The turkeys the guys will get this month are an example.
 

TPendagast

LawnSite Fanatic
That depends on the benefit, and technically all benefits are suppose to be taxed. Not that really it happens
No

you do not pay taxes on benefits
They are not income

you pay taxes on PERKS (or you should) like a company truck or a cell phone.

health insurance and the like aren’t taxed
Retirement like 401k are pre tax dollars , you’d pay when you withdraw , not on your paycheck at the time

Things like sick days or vacation time aren’t taxable , the income from that day is , just like you had worked
But PTO has a tangible benefit to an employee, where as it doesn’t “technically”
Cost the employer any money to provide it.

PTO is one of the things employers get the stingiest with and it’s one of the easiest benefits to offer.
 

kemco

LawnSite Fanatic
Location
Memphis TN
Agreed. The turkey is non taxable. However if you have out a turkey plus a bottle of Glenlivet 21 (or similar $250 bottle of Scotch) I could see the IRS possibly disallowing the Glenlivet portion.
 

TPendagast

LawnSite Fanatic
I'm actually using those for my argument here. Quite aware of them. And quite aware of their limitations. Even though I say "my argument" I mean my reasoning as I'm not trying to argue. Just because someone, including a CPA calls something paid out a de minimus benefit doesn't make it so is my point. I've been on the wrong side of the IRS. Doesn't matter what the CPA did as you the business owner signed off on it. Lots of CPAs are wrong or mischaracter items, maybe not on purpose but maybe so hoping you aren't audited.
Show me where on your tax records/pay stub as an employee you pay taxes on health insurance , retirement, or any of the other things that are considered a classic “fringe benefit”
 

TPendagast

LawnSite Fanatic
Agreed. The turkey is non taxable.
It’s considered a “gift”, If I recall the gift limit is $600

so if you were gifted a whole car, you would technically have to pay tax on that “income”

a recipient should be careful how many “gifts” they receive , however most of us peasants will never get caught receiving too many Christmas presents and having to pay more tax
 

kemco

LawnSite Fanatic
Location
Memphis TN
Your reference is based on gifts from a personal level. Employer to employee is a completely different animal to the IRS and under completely different rule set

Edit... I believe... now I've got me second guessing myself. Oh well. Yeah that was wrong on my part I just looked it's $15k per year personally to as many people as you want. Not sure about the ER to EE limit.
 

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