Tag: taxes

Question: What is the tax rule regarding transportation benefits? If we want to reimburse employees for their monthly transit pass, does that count as employees’ income? Answer: The employer may assist employees in transportation to and from work and exclude the value of such a benefit from the employees’ taxable income. A qualified transportation fringe…

Question: If we are issuing severance pay to an employee, does it have to be taxed? Answer: Severance pay is considered a taxable compensation and should be run through payroll. If there is a desire to avoid tax implications for the employee, the employer may ‘gross up’ the wages to cover the tax deductions from…