Page 25 - Tax Reforms - Businesses

EDCFB – Employer deduction for certain

Fringe Benefits (7/14)

05 EDCFB

The new law disallows employer deductions for
(1) activities generally considered to be
entertainment, amusement, or recreation; (2)
membership dues for clubs organized for

business, pleasure, recreation, or other social
purposes; or (3) a facility used in connection with
the above items, even if the activity is related to
the active conduct of trade or business.
It also disallows deductions for expenses
associated with transportation fringe benefits or
expenses incurred providing transportation for
commuting (except as necessary for employee
safety).

Under the new law, there is now a prohibition on
cash, gift cards and other non-tangible personal
property as employee achievement awards.
Special rules allow an employee to exclude
certain achievement awards from their wages if
the awards are tangible personal property.

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