If my company provides corporate housing for me, am I required to claim the rent amount as income for my personal earnings? And is that taxable income?

I'm trying to figure out how I can leverage asking my boss to pay for an apartment as opposed to asking for a raise. I am trying to see what kind of effect this would have on me.

I reside in the State of Nebraska.

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    It's not my corporation. I'm trying to figure out if I can leverage asking my boss to pay for an apartment as opposed to asking for a raise and trying to see what kind of effect this would have on me. – Mechaflash Sep 11 '12 at 17:53
  • @George, I took the liberty of rewording the original question, and putting the OP's explanation from the comments in there, to make it clear. – littleadv Sep 11 '12 at 18:05
  • What if you put a single server in your apartment? Then your apartment is a "business premise". – user14058 Mar 28 '14 at 7:33

If the employer provides housing to the employee, the employer has to identify whether it is taxable or not. If it is - the amounts would be added to the taxable income on your W2. All the withholding and FICA tax calculations will be performed based on that taxable income. If the employer fails to do that, and you get audited, you can be left on the hook for the unpaid taxes on the unreported income.

In some cases, employee housing is a non-taxable fringe benefit, in others it is taxable. Your tax adviser will help identify which case applies to you.

After you added in a comment that you're trying to see if you should be asking your boss to pay your personal expenses vs. giving you a raise - as I said in the comments, your personal expenses are not deductible neither for you nor for anyone else. If your boss pays your rent instead of a raise - its taxable income for you.

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  • I did a bunch of searches on 'fringe benefits' and it lead me to law.cornell.edu/uscode/text/26/119?quicktabs_8=1#quicktabs-8 . Section a-2 shows the rules for supplying housing to an employee. It's non-taxable only if the housing is on business premises, it's at the convenience of the business to have the employee be at that location, and it's a stipulation of the employment agreement. – Mechaflash Sep 11 '12 at 19:09
  • Indeed. What is "business premises" and how to define "convenience of the business", is a matter of interpretation. However, it also has to be necessary and ordinary, as well, just as any other business expense. – littleadv Sep 11 '12 at 19:11
  • That's the funny thing... I can't find anywhere that can specifically define a 'business premises'. I know one type of business that does that: apartment complexes. They hire their maintenance staff and house them on-site, and this is allowable. I know that my job requires me to live in a very close proximity to the office, as if an emergency occurs with our network or servers, I need to be accessible right away. But you are definitely right, this is something a local tax lawyer will probably have to answer. – Mechaflash Sep 11 '12 at 19:17
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    I believe in your case its a lost cause. You're already employed, and you're not required to live on the premises. I don't think any tax attorney will be able to prove that a change has occurred to be significant enough for the situation to change. If I were you I'd ask for a raise and stop worrying about it. – littleadv Sep 11 '12 at 19:20

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