Fringe benefits provided to employees are considered taxable wages unless they are specifically excluded from income by a provision of the US Income Tax Code.

Fringe benefits are considered payment "in kind." Payments in kind may be in the form of automobiles, awards, event tickets, athletic tickets, gifts, graduate grant in aid, club dues, housing, moving allowance, prizes, spousal travel, student health insurance, goods, lodging, food, clothing, services and miscellaneous income.

An employer must include all fringe benefits in an employee's gross income, as they are subject to federal withholding and FICA and/or Medicare taxes.

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Here is a sample schedule of when Payroll plans to tax the various fringe benefits. The taxation may vary by a month or so within a semester depending on the receipt of the documentation by Payroll.

Automobiles -
January through June - taxed in May
July through December - taxed in November

Athletic Tickets -
Football - taxed in October
Basketball - taxed in February

Student Health Insurance -
Fall Semester - taxed in October
Spring Semester - taxed in February

Graduate Grant In Aid - taxed monthly

The taxation of all other fringe benefits is normally on the first paycheck following notification of the fringe benefit to Payroll.

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