When is employer provided housing taxable to the employee? When can it be deducted fully by the employer?

My answer to When is employer provided housing taxable to the employee?  When can it be deducted fully by the emplo…

Answer by Wray Rives:

Generally the cost to provide employee housing is always a deduction for the business.  When it is taxable to the employee depends on several questions:

  1. Is the housing provided for the convenience or benefit of the business
  2. Is the housing on the business premises
  3. Is using the housing a condition of employment

If you can answer yes to all three, then the housing should not be taxable to the employee.

You may want to read the IRS guide regarding Fringe Benefits at Publication 15-B (2012), Employer’s Tax Guide to Fringe Benefits

When is employer provided housing taxable to the employee?  When can it be deducted fully by the employer?