I am a student and am applying for a summer internship which is in another state. The employer indicated that participants will stay in an apartment free of charge, which is a taxable benefit. Does this mean they write this off when they file taxes, or does this mean that this will count against me when I file taxes?
2006-11-04 18:12:44 · 5 answers · asked by G 3 in Business & Finance ➔ Taxes ➔ United States
A taxable benefit is something you receive at no cost. It is taxable because you pay tax on the value of the benefit. It is a benefit because if you had to pay $500 per month in rent you would be out $500. Compare this to a taxable benefit where if you pay tax on the benefit you may be paying say 20% in taxes or $100. So rent only costs you $100 instead of $500.
2006-11-04 22:01:57 · answer #1 · answered by waggy_33 6 · 1⤊ 0⤋
a taxable beneift will be taxable to you for your personal income tax. which means the value of the apartment will be included in your w-2 or 1099. your employer will probably withhold the taxes on the value of the benefit for the apartment. however you might want to verifiy if they will withhold or not. otherwise, you could be stuck with a tax bill come april 15.
2006-11-05 02:24:10 · answer #2 · answered by kappyfinn 1 · 2⤊ 0⤋
I think it is a tax benefit for the company because they can save money from paying taxes for offering you this apartment. So, the company might get reimbursed for offering this, or something like that. But i think that's mainly for the company's benefit.
2006-11-05 02:19:09 · answer #3 · answered by #125 3 · 0⤊ 1⤋
Both, it is a deductible expense for the company and counts as income for you.
2006-11-05 14:13:34 · answer #4 · answered by STEVEN F 7 · 1⤊ 0⤋
I don't know. But pass me if u find the right answer.
2006-11-05 03:01:56 · answer #5 · answered by teenboy 1 · 0⤊ 1⤋