IRS considers taxing work perks like food, gym memberships

Michael Lundin, Claudia Cowan

foxnews.com

In competitive job markets like Silicon Valley, companies are doing everything they can to entice the best and brightest -- offering freebies that have become the stuff of legend.

Employee perks like free food at lavish cafeterias, laundry...

But the taxman could soon crack down.

The IRS reportedly is looking at these perks and seeing if these companies need to start paying up for the free stuff they offer employees.

David Gamage, a tax expert and professor at the University of California, Berkeley, said it would really boil down to who benefits from these perks.

"To what extent is this intended as a perk, a form of compensation, for the benefit of the employee, or to what extent is this just another way the employer gets the employee to work harder and longer and do things for the benefit of the employer?" he said.

If it's the latter, then it's harder for the IRS to tax it.

The Wall Street Journal first reported that the agency is considering whether the freebies like food, shuttles, haircuts and more are really fringe benefits on which workers should be taxed.

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