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Brandon, Esq.
Brandon, Esq., Lawyer
Category: California Employment Law
Satisfied Customers: 1825
Experience:  Has received a certificate of recognition from the California State Senate for his outstanding legal service.
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When signing on to a new company as a full time employee, I

Resolved Question:

When signing on to a new company as a full time employee, I wanted to work out a deal where instead of taking a higher salary, the company would provide an apartment for me. The thinking is that this would keep my salary within a lower tax bracket, and the company would benefit from not having to pay employment taxes on that part of my salary.

Is there any validity to this? Is there any benefit of me having the company provide an apartment, tax or otherwise?
Submitted: 1 year ago.
Category: California Employment Law
Expert:  Brandon, Esq. replied 1 year ago.

Employment-LawExpert :

Hello and thank you for your question today.

Employment-LawExpert :

Are you online with me?

Employment-LawExpert :

Welcome to the chat

Customer:

Hello

Employment-LawExpert :

As I am sure you know by now, any employment contract is negotiable. So, as to whether or not there is validity to this, if an employer agrees to do it, it is entirely an option. However, there are some positives and negatives to all parties involved.

Customer:

Completely understand, lets hear them.

Employment-LawExpert :

The benefit to you would be that you would basically be receiving free income. The negative would be that your employer would be able to take away your place to live at any time. If you engage in such a contract you should make sure that you sign a contract that is for cause.

Employment-LawExpert :

You do not want to run the risk of loosing your income, and your place to live all at the drop of a hat, for no apparent reason.

Customer:

Yes, I completely understand. My concern is more to the tax law itself. Would a full time appartment for me that the company is providing, be considered income anyway?

Employment-LawExpert :

no it would not

Employment-LawExpert :

Though the company would be able to use the apartment as a deduction for themselves

Employment-LawExpert :

which would be the benefit to them

Customer:

Exactly, and because my salary is at the line of a tax bracket, it greatly benefits me to lower my salary and accept an appartment

Customer:

granted, all of the contracts were in place to make sure the appartment was secured

Employment-LawExpert :

Financially yes, however, again, and I cannot stress this enough, I have had numerous people call me over the years complaining about getting fired and being evicted

Customer:

Completely understand

Employment-LawExpert :

Which would be the right of the company absent contractual language to the contrary

Employment-LawExpert :

As for the company, they may not want to do this, as many locations require long term leases

Customer:

So, there is no tax law that states that if a company were to provide an appartment for me, full time, that it would be considered "compensation" and that I would have to declare it

Employment-LawExpert :

Correct. The apartment would not be considered compensation unless it was strictly written into the contract to be so

Employment-LawExpert :

i.e. you get an allowance of $2,000 a month to rent an apartment would be compensation

Employment-LawExpert :

different from you are provided withXXXXX/p>

Customer:

understood

Customer:

great, thank you for your time

Employment-LawExpert :

Not a problem. Have I fully answered your question today?

Customer:

Yes, you have. Thanks again.

Brandon, Esq., Lawyer
Satisfied Customers: 1825
Experience: Has received a certificate of recognition from the California State Senate for his outstanding legal service.
Brandon, Esq. and other California Employment Law Specialists are ready to help you

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