Have a Tax Question? Ask a Tax Expert
My initial thoughts are that, if you reimburse all employees for this sort of thing on an accountable basis, and you do not discriminate, you would be operating in accordance with the rules for a Section 125 cafeteria plan. The employees could receive the benefit of having their fees payed for or treated as cash compensation.
See IRC Sec. 125 here:
How Current is This?
(a) General rule Except as provided in subsection (b), no amount shall be included in the gross income of a participant in a cafeteria plan solely because, under the plan, the participant may choose among the benefits of the plan.
(b) Exception for highly compensated participants and key employees
(1) Highly compensated participants In the case of a highly compensated participant, subsection (a) shall not apply to any benefit attributable to a plan year for which the plan discriminates in favor of-
(d) Cafeteria plan defined
For purposes of this section-
(1) In general The term "cafeteria plan" means a written plan under which-
(A) all participants are employees, and
(B) the participants may choose among 2 or more benefits consisting of cash and qualified benefits.
(f) Qualified benefits defined For purposes of this section, the term "qualified benefit" means any benefit which, with the application of subsection (a), is not includible in the gross income of the employee by reason of an express provision of this chapter (other than section 106 (b), 117, 127, or 132). Such term includes any group term life insurance which is includible in gross income only because it exceeds the dollar limitation of section 79 and such term includes any other benefit permitted under regulations. Such term shall not include any product which is advertised, marketed, or offered as long-term care insurance.
An employer can not require an employee to be responsible for any costs associated with obtaining an H1 visa. If they can not require that the employee bear any costs, they can not count it as a "fringe benefit". See below link re: right/responsibilites of H1 Visa holders and H1 Visa Employers: (You will need to copy & paste this into your web browser)
My answer was to assume they were taxable, in which case, they would not be taxable under Section 125.
The direct answer is that they are not taxable as fringes per the second answer posted. Any aspect of the costs above that do not fall under that direct answer can again be excluded under my (the first answer) above.
In other words, no, they are not taxable to employees, either because the law directly says they are not taxable and/or because the amounts are otherwise not taxable under a plan.
I assume this clears it up.
Thank you for your question, but do let me know if you need more clarification.
My wife is also a CPA who travels the world for her company, auditing, on visas all the time. I can ask her when she gets back and will update with her comments if you like (let me know?).
In the mean time, if the other expert here has a direct answer (or any expert) I invite her to answer over me again. That expert should deserve the credit here of course too (my answer is still just my initial thoughts and is indirect despite being interesting and applicable I feel, but not the direct one you are looking for I understand).