January 2026 Q and A

QUESTION:

What are taxable fringe benefits?

ANSWER:

Generally, you must report the value of benefits you provide to your staff as employees' taxable income — unless explicitly excluded by the IRS. These benefits include employee discounts on goods or services, parking subsidies of up to $340 (as of 2026), and company services offered at cost. They also include modest holiday gifts, minimal personal use of office equipment, and even occasional company parties. The value of more substantial benefits, such as personal use of a company car or a country club membership, must also be included in taxable income. Starting in 2026, most moving expenses and bicycle commuting reimbursements are now taxable.