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# Benefits + Taxation

Jamal, age 52, is a manager for Triple W Company. His annual salary is \$110,000 and he receives the following fringe benefits during the current year:

- Triple W pays for all employees' health and accident insurance. Triple W pays \$4,000 for Jamal's health insurance during the year.
- Triple W provides Jamal with group-term life insurance coverage of \$200,000 during the year. The monthly inclusion amount per \$1,000 of coverage is \$.23.
- Triple W has a flexible benefits plan in which employees may participate to pay any costs not reimbursed by their health insurance. Jamal has \$3,600 withheld from his salary under the plan. During the year he receives reimbursements of \$3,300.
- Triple W pays parking costs for all management employees. Jamal's parking costs \$220 month.
- Triple W pays Jamal's annual membership dues of \$450 to the Society of Human Resource Management Association. The company also subscribes to several management journals for Jamal costing \$650 a year.
- Jamal took a college class on employment law and Triple W reimbursed his tuition of \$6,000.
- Jamal's consumption of coffee provided by Triple W is valued at \$700 a year.

How much income must Jamal report from his job?

A. \$106,400
B. \$107,564
C. \$110,000
D. \$110,414

Health is excludable
Life is to first 50,000 (150,000/1,000x.23) x 12 = 414 needs to be added
Flexible benefits - to first 2,500? I don't know where to place this one.
Parking is excluded
Memberships, tuition, journals - excluded
Coffee - de minimus

Answer is C. But I don't know if the flex benefits are excluded or not.

#### Solution Preview

Excess life insurance coverage = ((200000-50000)/1000)*0.23*12 = ...

#### Solution Summary

The benefits and taxation for Triple W Company.

\$2.19