How can I offer pre-paid gas cards to my employees as a “benefit”?
Rick F asked:
I’d like to offer $100 prepaid gas cards to my employees every month and structure it as a tax free benefit.
I’d pay less as an employer and they would get the gas card with “pre tax” dollars.
I’d like to offer $100 prepaid gas cards to my employees every month and structure it as a tax free benefit.
I’d pay less as an employer and they would get the gas card with “pre tax” dollars.
In the end, a $100 gas card, instead of cash compensation, would be like the employee receiving $120-$135 post tax dollars.
Any LEGAL ideas?
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January 6th, 2010 at 8:21 pm
You can’t do it legally. You have to pay taxes on it and they have to pay taxes on it.
January 7th, 2010 at 8:51 pm
I don’t think it can be considered “tax free”. It is additional compensation.
January 11th, 2010 at 2:11 am
Check for tax implications for you and your employees.
January 13th, 2010 at 5:05 am
when you figure it out please send me one
January 15th, 2010 at 8:24 pm
I WISH MY EMPLOYER DID THAT…
January 16th, 2010 at 6:15 pm
You can do it “tax free” to them by paying your and their taxes on it (i.e., paying them a bit of a bonus extra that would amount to the tax withheld on the value of the card, plus the tax on that amount). This is much like the “tax free” sales certain stores here run — it’s not really tax free unless the government says it is, but they pay your taxes for you when you buy during the sale.
Tax free to you? Nope, sorry.
January 20th, 2010 at 2:13 am
never heard of a legal pre-tax deduction for gas cards – I don’t think you can do that -
January 21st, 2010 at 1:35 am
no, they will need to pay taxes for it as it is an income, or you may pay for the taxes
January 22nd, 2010 at 1:32 pm
Think about the “Gift” of up to $12,000 to any person that is non-taxable to them
You may give up to 12k to as many individuals as you want without incurring any gift tax. Thsi annual gift tax exclusion applies only to gifts of “present interests” – items than be used, possessed, and enjoyed presently. Examples of a gift of a present interest include gifts of money, holiday presents, and so forth. Hope this helps! Btw, congrats to you on being a kind of boss who wants to help his/her employees.
January 24th, 2010 at 11:46 pm
Nope. No difference between a gas card and straight up cash.