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News Desk
IRS relaxes taxation of Employer provided cell phones and similar equipmentThe IRS issued today Notice 2011-72, which provides that, when an employer provides an employee with a cell phone "primarily for noncompensatory business reasons," (i) the IRS will treat the employee's use of the cell phone for reasons related to the employer's trade or business as a working condition fringe benefit, the value of which is excludable from the employee's income; and (ii) solely for purposes of determining whether the working condition fringe benefit rule applies, the substantiation requirements that the employee would have to meet in order for a section 162 deduction to be allowable are deemed to be satisfied. Sales TaxOne certainty in tax practice is that sales-tax rules are never constant. Changes, and even potential changes, often require action on the part of sellers, buyers and their tax advisers. If you are unsure of what is taxable and what is not please contact us and we will research your questions and let you know if there is concern. The Affordable Care ActThe Treasury Department and Internal Revenue Service today requested public comment on a proposed affordability safe harbor for employers under the shared responsibility provisions included in the Affordable Care Act that will apply to certain employers starting in 2014. Under the Affordable Care Act, employers with 50 or more full-time employees that do not offer affordable health coverage to their full-time employees may be required to make a shared responsibility payment. Notice 2011-73, posted today on IRS.gov, solicits public input and comment on a proposed safe harbor, designed to make it easier for employers to determine whether the health coverage they offer is affordable. To that end, Treasury and IRS expect to propose a safe harbor permitting employers that offer coverage to their employees to measure the affordability of that coverage by using wages that the employer paid to an employee, instead of the employee’s household income. This contemplated safe harbor would only apply for purposes of the employer shared responsibility provision, and would not affect employees’ eligibility for health insurance premium tax credits. Today’s request for comment is designed to ensure that Treasury and IRS continue to receive broad input from stakeholders on how best to implement the shared responsibility provisions in a way that is administrable, allows flexibility, and minimizes burden. By soliciting comments and feedback now, Treasury and IRS are giving all interested parties the opportunity for input before proposed regulations are issued.
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