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Category: General Questions

What are Fringe Benefits?

Fringe benefit(s) is a form of pay you may receive from your employer for the performance of services. For example, your employer provides you with a fringe benefit if you are allowed to use a business vehicle to commute to and from work. Fringe benefits commonly include health insurance, group term life coverage, education reimbursement, childcare and assistance reimbursement, cafeteria plans, employee discounts, housing allowance (if a member of the clergy), and other similar benefits.

Note: You may perform services as an independent contractor, partner, pastor (minister), or director and still receive fringe benefits. You do not have to be an employee.

Are my Fringe Benefits taxable?

Any fringe benefit that you receive is taxable and must be reported on your income tax return, however, IRS law does allow certain exclusions. To determine if your fringe benefit(s) is exempt from taxation, please refer to Section Two: Fringe Benefit Exclusion Rules of IRS Publication 15b. Any benefit that is not excluded is considered taxable.

Minister's Only: If you are a minister and receive a housing allowance, you may exclude the allowance from your gross income to the extent it is used to pay expenses for your home. Generally, this would include rent, mortgage interest, utilities, repairs, and other expenses directly relating to providing a home. **If your housing allowance exceeds the lesser of your reasonable salary, the fair market value of your home, or your actual expenses, you must include the excess as a taxable fringe benefit.

TaxSlayer Entry: To report your taxable fringe benefit(s), from the Welcome To My Account screen, select Federal Section from the black navigation bar followed by Enter Myself>>>Other Income>>>Other Compensation>>>Fringe Benefits.