Publication 15-B - Employer'S Tax Guide To Fringe Benefits - 2012 Page 18
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33and lunch periods, you can exclude from her wages the
but, because of the work duties, they were not eaten during
working hours.
value of her breakfast and lunch.
If you also allow Carol to have meals on your business
Meals you furnish to promote goodwill, boost mo-
premises without charge on her days off, you cannot ex-
rale, or attract prospective employees. Meals you fur-
clude the value of those meals from her wages.
nish to promote goodwill, boost morale, or attract
prospective employees are not considered furnished for
Employees available for emergency calls. Meals you
your convenience. However, you may be able to exclude
furnish during working hours so an employee will be avail-
their value as discussed under
De Minimis
Meals, earlier.
able for emergency calls during the meal period are fur-
nished for your convenience. You must be able to show
Meals furnished on nonworkdays or with lodging.
these emergency calls have occurred or can reasonably
You generally cannot exclude from an employee’s wages
be expected to occur.
the value of meals you furnish on a day when the employee
is not working. However, you can exclude these meals if
Example. A hospital maintains a cafeteria on its prem-
they are furnished with lodging that is excluded from the
ises where all of its 230 employees may get meals at no
employee’s wages as discussed under
Lodging on Your
charge during their working hours. The hospital must have
Business
Premises, earlier in this section.
120 of its employees available for emergencies. Each of
Meals with a charge. The fact that you charge for the
these 120 employees is, at times, called upon to perform
meals and that your employees may accept or decline the
services during the meal period. Although the hospital
meals is not taken into account in determining whether or
does not require these employees to remain on the prem-
not meals are furnished for your convenience.
ises, they rarely leave the hospital during their meal period.
Since the hospital furnishes meals on its premises to its
S corporation shareholder-employee. For this exclu-
employees so that more than half of them are available for
sion, do not treat a 2% shareholder of an S corporation as
emergency calls during meal periods, the hospital can
an employee of the corporation. A 2% shareholder is
exclude the value of these meals from the wages of all of
someone who directly or indirectly owns (at any time dur-
its employees.
ing the year) more than 2% of the corporation’s stock or
stock with more than 2% of the voting power. Treat a 2%
Short meal periods. Meals you furnish during working
shareholder as you would a partner in a partnership for
hours are furnished for your convenience if the nature of
fringe benefit purposes, but do not treat the benefit as a
your business restricts an employee to a short meal period
reduction in distributions to the 2% shareholder.
(such as 30 or 45 minutes) and the employee cannot be
expected to eat elsewhere in such a short time. For exam-
Moving Expense Reimbursements
ple, meals can qualify for this treatment if your peak
work-load occurs during the normal lunch hour. However,
This exclusion applies to any amount you directly or indi-
they do not qualify if the reason for the short meal period is
rectly give to an employee, (including services furnished in
to allow the employee to leave earlier in the day.
kind) as payment for, or reimbursement of, moving ex-
penses. You must make the reimbursement under rules
Example. Frank is a bank teller who works from 9 a.m.
similar to those described in chapter 11 of Publication 535
to 5 p.m. The bank furnishes his lunch without charge in a
for reimbursement of expenses for travel, meals, and en-
cafeteria the bank maintains on its premises. The bank
tertainment under accountable plans.
furnishes these meals to Frank to limit his lunch period to
The exclusion applies only to reimbursement of moving
30 minutes, since the bank’s peak workload occurs during
expenses that the employee could deduct if he or she had
the normal lunch period. If Frank got his lunch elsewhere, it
paid or incurred them without reimbursement. However, it
would take him much longer than 30 minutes and the bank
does not apply if the employee actually deducted the
strictly enforces the time limit. The bank can exclude the
expenses in a previous year.
value of these meals from Frank’s wages.
Deductible moving expenses. Deductible moving ex-
Proper meals not otherwise available. Meals you fur-
penses include only the reasonable expenses of:
nish during working hours are furnished for your conve-
•
nience if the employee could not otherwise eat proper
Moving household goods and personal effects from
meals within a reasonable period of time. For example,
the former home to the new home, and
meals can qualify for this treatment if there are insufficient
•
Traveling (including lodging) from the former home
eating facilities near the place of employment.
to the new home.
Meals after work hours. Meals you furnish to an em-
ployee immediately after working hours are furnished for
Deductible moving expenses do not include any ex-
your convenience if you would have furnished them during
penses for meals and must meet both the distance test and
working hours for a substantial nonpay business reason
the time test. The distance test is met if the new job
Page 18
Publication 15-B (2012)
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