Fringe Benefits

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DEFINITION of 'Fringe Benefits'

A collection of various benefits provided by an employer, which are exempt from taxation as long as certain conditions are met. Any employee who receives taxable fringe benefits will have to include the fair market value of the benefit in their taxable income for the year, which will be subject to tax withholdings, and social security benefits payments.

INVESTOPEDIA EXPLAINS 'Fringe Benefits'

Fringe benefits commonly include health insurance, group term life coverage, education reimbursement, childcare and assistance reimbursement, cafeteria plans, employee discounts, personal use of a company owned vehicle and other similar benefits.

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RELATED FAQS
  1. What types of companies usually offer fringe benefits?

    Fringe benefits are often provided to employees in an effort to create a more favorable working environment and increased ... Read Full Answer >>
  2. What types of regulations are in place regarding fringe benefits?

    Government influence on non-salary employee benefits, also called "fringe benefits," comes, in large part, through the tax ... Read Full Answer >>
  3. How do fringe benefits help increase employee retention?

    Employers have a variety of creative ways to entice new talent and keep quality workers within their organizations, including ... Read Full Answer >>
  4. Are part-time employees eligible for fringe benefits?

    Part-time employees make up a substantial part of the U.S. workforce, and as more individuals take on part-time work, employers ... Read Full Answer >>
  5. What are some examples of common fringe benefits?

    The majority of employers in the private and public sectors offer their employees a variety of benefits in excess of stated ... Read Full Answer >>
  6. How are an employee's fringe benefits taxed?

    Common fringe benefits provide employees total compensation above and beyond stated wages or salaries, and a wide range of ... Read Full Answer >>
  7. What incentives does an employer have in offering fringe benefits?

    More often than not, employers offer employees benefits above and beyond an agreed-upon wage or salary. In addition to a ... Read Full Answer >>
  8. What is the difference between gross income and earned income?

    Prior to preparing and filing a tax return, do yourself a favor by gaining an understanding of commonly used tax terms including ... Read Full Answer >>
  9. Are fringe benefits deductible for the employer?

    A fringe benefit is any non-wage form of compensation and is usually offered by an employer as both an employee incentive ... Read Full Answer >>
  10. Does everyone have to file a federal tax return?

    This may come as a surprise to many individuals, but not everyone needs to file a federal tax return. According to the IRS, ... Read Full Answer >>
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