Chapter 3
Fringe Benefits
Employer-furnished fringe benefits are exempt from tax if the tests discussed in this chapter are met.
The most common tax-free benefits are accident and health plan coverage, including employer contributions to health savings accounts (HSAs), group-term life insurance plans, dependent care plans, education assistance plans, tuition reduction plans, adoption benefit plans, cafeteria plans, and plans providing employees with discounts, no-additional-cost services, or employer-subsidized meal facilities.
Highly compensated individuals may be taxed on certain benefits from such plans if nondiscrimination rules are not met.
3.1 Tax-Free Health and Accident Coverage Under Employer Plans
3.2 Health Savings Accounts (HSAs) and Archer MSAs
3.3 Reimbursements and Other Tax-Free Payments From Employer Health and Accident Plans
3.4 Group-Term Life Insurance Premiums
3.7 Education Assistance Plans
3.8 Company Cars, Parking, and Transit Passes
3.9 Working Condition Fringe Benefits
3.10 De Minimis Fringe Benefits
3.11 Employer-Provided Retirement Advice
3.12 Employee Achievement Awards
3.13 Employer-Furnished Meals or Lodging
3.14 Minister’s Rental or Housing Allowance
3.15 Cafeteria Plans Provide Choice of Benefits
3.16 Flexible Spending Arrangements
3.17 Company Services Provided at No Additional Cost
3.18 Discounts on Company Products or Services
Table 3-1 Are Your Fringe Benefits Tax Free?
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