IRS: Value of ‘free’ parking may be taxable fringe benefit — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily

IRS: Value of ‘free’ parking may be taxable fringe benefit

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in Office Management,Payroll Management

by Vicki M. Nielsen, Esq., Ogletree Deakins

A recent Information Letter issued by the IRS on the taxation of employer-provided parking, although noncontroversial, serves as a useful reminder that “free” parking for employees may result in taxes for both the employee and the employer.

IRS Information Letter 2014-0017 (June 27, 2014) explains that if an employer provides a free benefit to employees for qualified parking, the value of which exceeds the maximum amount that may be excluded from an employee’s income per month, the value of the benefit exceeding the exclusion limit is included in the employee’s wages for income and employment tax ­purposes.

General rules

Employers may provide certain trans-portation fringe benefits to their employees without including their fair market value in their income. Those benefits may include qualified parking, transit passes or vouchers, fare cards or reimbursements for fare cards. Also i...(register to read more)

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