For the latest information about developments related to Publication 15-B, such as legislation enacted after it was published, go to www.irs.gov/pub15b.
$2,500 limit on a health flexible spending arrangement (FSA). For plan years beginning after December 31, 2012, a cafeteria plan may not allow an employee to request salary reduction contributions for a health FSA in excess of $2,500. For more information, see Cafeteria Plans in section 1.
Additional Medicare Tax withholding. In addition to withholding Medicare tax at 1.45%, you must withhold a 0.9% Additional Medicare Tax from wages you pay to an employee in excess of $200,000 in a calendar year. You are required to begin withholding Additional Medicare Tax in the pay period in which you pay wages in excess of $200,000 to an employee and continue to withhold it each pay period until the end of the calendar year. Additional Medicare Tax is only imposed on the employee. There is no employer share of Additional Medicare Tax. All wages that are subject to Medicare tax are subject to Additional Medicare Tax withholding if paid in excess of the $200,000 withholding threshold. For more information on what wages are subject to Medicare tax, see Table 2-1, later, and the chart, Special Rules for Various Types of Services and Payments, in section 15 of Publication 15, (Circular E), Employer's Tax Guide.
Extension of the exclusion for educational assistance programs. The exclusion for educational assistance has been extended to years beginning after December 31, 2012. For more information about this exclusion, see Educational Assistance in section 2.
Extension of the exclusion for adoption assistance programs. The exclusion for adoption assistance has been extended to years beginning after December 31, 2012. For more information about this exclusion, see Adoption Assistance in section 2.
Leave-based donation programs to aid victims of Hurricane Sandy. Under these programs, employees may donate their vacation, sick, or personal leave in exchange for employer cash payments made before January 1, 2014, to qualified tax-exempt organizations providing relief for the victims of Hurricane Sandy. The donated leave will not be included in the income or wages of the employee. The employer may deduct the cash payments as business expenses or charitable contributions. For more information, see Notice 2012-69, 2012–51, I.R.B. 712, available at www.irs.gov/irb/2012-51_IRB/ar09.html.
Cents-per-mile rule. The business mileage rate for 2013 is 56.5 cents per mile. You may use this rate to reimburse an employee for business use of a personal vehicle, and under certain conditions, you may use the rate under the cents-per-mile rule to value the personal use of a vehicle you provide to an employee. See Cents-Per-Mile Rule in section 3.
Qualified parking exclusion and commuter transportation benefit. . For 2013, the monthly exclusion for qualified parking is $245 and the monthly exclusion for commuter highway vehicle transportation and transit passes is $245. See Qualified Transportation Benefits in section 2.
Employer-provided cell phones. The value of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a working condition fringe benefit. Personal use of an employer-provided cell phone, provided primarily for noncompensatory business reasons, is excludable from an employee's income as a de minimis fringe benefit. For details, see Employer-Provided Cell Phones , De Minimis (Minimal) Benefits , and Working Condition Benefits in section 2.
Expiration of benefits for volunteer firefighters and emergency medical responders. . The gross income exclusion for benefits provided to volunteer firefighters and emergency medical responders expired on December 31, 2010.
Simple cafeteria plans. . The Patient Protection and Affordable Care Act amended code section 125 to allow eligible employers' cafeteria plans to qualify as simple cafeteria plans. Simple cafeteria plans as described in section 1 will be treated as meeting certain nondiscrimination requirements.
Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing and Exploited Children. Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.
This publication supplements Publication 15 (Circular E), Employer's Tax Guide, and Publication 15-A, Employer's Supplemental Tax Guide. It contains information for employers on the employment tax treatment of fringe benefits.
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