1040 Preparation and Planning 3: Gross Income: Compensation and Fringe Benefits (2024)

Author: Barbara Weltman, Sidney Kess, Greg White

Per the IRS Education Provider Standards this course must be COMPLETED by 12/31/2026 to receive credits

This two-hour CPE hour course, the third in the 1040 Preparation and Planning series, covers compensation and fringe benefits. It also covers the tax treatment of distributions and loans from qualified retirement plans. Tax developments reflected in this course, including the Consolidated Appropriations Act, 2023 (which includes SECURE Act 2.0), the Inflation Reduction Act of 2022, and other tax legislation, IRS pronouncements, and court decisions, are extensive. They impact 2023 tax year returns that will be filed during the 2024 filing season and refund opportunities for earlier years; as well as point the way to strategic planning in 2024 and beyond. This course brings the tax preparer "up-to-speed" in preparing 2023 tax returns for the 2024 filing season.

Publication Date: September 2023

Topics Covered

• Compensation for Personal Services
• Types of Compensation
• Payments to Government Employees/Volunteers
• Form W-2 Reporting and Withholding
• Sec. 83(b) Election
• Employee Stock Options — Tax Treatment Depends on the Type
• Nonqualified Stock Options
• Employee Stock Options and RSUs
• Foreign Earned Income and/or Housing Exclusion
• Foreign Housing Costs
• Group-Term Life Insurance Paid by Employer
• Group-Term Life Insurance
• Split-Dollar Life Insurance
• Life Insurance Premiums for Spouses and Dependents
• Meals Lodging Furnished to Employee
• Employer's Contributions to Employee Retirement Plans
• Employer's After-Tax Contributions
• Pensions and Retirement Pay Received
• COVID-19 Distributions and Recontributions
• Withholding on Pension Distributions
• Voluntary Withholding on Pension Distributions
• Disability Pensions
• Corrective Distributions from Retirement Plans
• Loans from Qualified Retirement Plans
• Medical Insurance and Reimbursement Plans
• Employer-Paid Long-Term Care Insurance
• Insurance Reimbursements
• Medical Reimbursement Accounts
• Health Savings Accounts
• Dependent Care Assistance Plans
• Employer-Provided Educational Assistance
• Employer-Provided Adoption Assistance
• Other Fringe Benefits
• Veterans and Members of the Armed Forces

Learning Objectives

• Identify compensation in whatever form it is paid
• Explain entries on Form W-2 as it relates to the income tax return
• Identify various types of employee benefits plans
• Recognize which benefits are taxable and which benefits are excludable from income

Level
Intermediate

Instructional Method
Self-Study

NASBA Field of Study
Taxes (2 hours)

Program Prerequisites
Basic understanding of Federal Tax Law

Advance Preparation
None