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Tax reform targets compensation and benefits

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Caucasian person counting moneyEnactment of new tax reform legislation in December 2017 includes impacts to organizations' compensation and benefits. The attached document summarizes the compensation and benefits provisions that are included in the final legislation.

How does the final tax reform bill address compensation and benefits?
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Certain compensation and benefits provisions are not included in the final version. These include the following:

  • Inclusion in an employee’s income of tuition reduction provided by an educational organization to the employee, spouse and dependents
  • Inclusion in an employee’s income of educational assistance payments made by the employer of up to $5,250 per year
  • Inclusion in an employee’s income of employer-provided housing for amounts over $50,000
  • Inclusion in an employee’s income of dependent care assistance funded by an employer or by an employee through a dependent care flexible spending arrangement
  • Inclusion in an employee’s income of adoption assistance provided by the employer
  • Various changes to qualified retirement plan rules, such as lowering the permissible age for in-service distributions and making larger amounts available for hardship distributions
  • Repeal of the employer-provided child care credit
  • Repeal of the work opportunity tax credit

Stay informed about tax reform
Contacts
Eddie Adkins
Partner, Washington National Tax Office
T +1 202 521 1565

Jeffrey Martin
Partner, Washington National Tax Office
T +1 202 521 1526