2011.12 Compensation - 6. An employee receives $110,000 of...

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Unformatted text preview: 6. An employee receives $110,000 of group term life insurance coverage per year. The coverage cost his employer $90. The IRS's uniform applicable rate is $1.08 per year per $1,000 of coverage. What amount is taxable to the employee? A) $ 64.80 B) $ 54.00 C) $ 90.00 D) $118.80 Not disguised salary Used for tuition, fees, books, supplies, equipment If a candidate for a degree Make whole amount, including workers compensation and reimbursement for medical costs not taxable Punitive, etc. including loss of goodwill, loss of income is taxable Pain and suffering usually taxable Improve amounts (e.g. cosmetic surgery) usually taxable Health Savings Accounts reimbursements generally not taxable Health Savings Accounts are savings accounts, the contributions for which are tax deductible and payouts are not taxable (if the payout was used for medical expenses). These accounts normally have very high deductibles. For 2010, contributions to savings acct. can be as high as $6,150 for families and $3,050 for self-only coverage.as $6,150 for families and $3,050 for self-only coverage....
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This note was uploaded on 03/27/2012 for the course ACCT 3312 taught by Professor Staff during the Spring '08 term at Texas A&M University, Corpus Christi.

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2011.12 Compensation - 6. An employee receives $110,000 of...

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