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Lane
Lane, JD, CFP, MBA, CRPS
Category: Tax
Satisfied Customers: 10891
Experience:  Law Degree, specialization in Tax Law and Corporate Law, CFP and MBA, Providing Financial & Tax advice since 1986
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I am a property manager for a camping resort in E WA. During

Customer Question

I am a property manager for a camping resort in E WA. During the peak season, in addition to my salary, (far more than minimum wage) I am reimbursed for my rent for living nearby but not on the property site. On the off season, I receive free housing on site, my salary, and continue to receive my reimbursement for housing I no longer pay/live in off site....Only my base salary is reported on my W2....and I do not receive a 1099... Is this right??
JA: The Accountant will know how to help. Is there anything else the Accountant should be aware of?
Customer: I have been advised by non professionals that this is incorrect and that I could be liable for more taxes owed if I should be audited and also that it is being mis-reported in order to save my company money in L&I and other employer payroll costs etc.....
Submitted: 4 months ago.
Category: Tax
Expert:  emc011075 replied 4 months ago.

Hi. My name is ***** ***** I will be happy to help you.

If you receive free rent or rent reimbursement in lieu of salary, the fair market value of the rent is usually considered a taxable income. However there are two major exceptions:

1. The lodging is for convenience of the employer

2. It is a temporary job location.

If living on the premises is required by your employment contract it is furnished on the business premises than the free rent and reimbursement is not taxable. However if the rent is part of the compensation package (a benefit) than it is considered a taxable income.

The second exception would apply if the job location would a temporary location, less than one year.

Customer: replied 4 months ago.
I received this same info for free on line....
Its not in lieu of salary and they are other exceptions if you read it depending on the time of year....
Expert:  emc011075 replied 4 months ago.

Yes, there's lot of information you can get for free online. Some are accurate and some not so much. I am not aware of any IRS exception that would apply to a specific time of year.

Expert:  Lane replied 4 months ago.

Hi. My name's Lane. I can help her... you previous expert opted out.

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Of course, you can receive this information online... the entire tax code is online here:

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U.S. Code: Title 26 - INTERNAL REVENUE CODE

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What you're paying for here, is experienced, credentialed tax pros that have the ability to apply and interpret that tax law.

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The previous expert has distilled this down to the two kernals (in this case exceptions) that ARE most important here.

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Fair market value of the rent is usually considered a taxable income, with two major exceptions:

1. The lodging is for convenience of the employer

2. It is a temporary job location.

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Seasonality, by the way, is irrelevant UNLESS it could change whether not the lodging would be deemed (1) for the convenience of he employer and/or (2) somehow makes the job temporary.

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Further, the definition above of "temporary" (for this purpose) is, in deed, one year.

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You cannot (should not) receive both a 1099 and a w-2 from he same employer payor

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You are either an employee or a contractor based on rules around the level of financial and behavioral control by an employer/contractor.

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You can read more about that here:

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https://www.irs.gov/businesses/small-businesses-self-employed/independent-contractor-self-employed-or-employee

Expert:  Lane replied 4 months ago.

Finally, IF your employer is incorrectly reporting it is your employer that may be subject to audit.

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If this is NOT on the premises, then there is that risk

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Please let me know if you have any questions at all, before rating me.

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And if you DON'T have other questions Your positive rating … (by using those the stars or faces on your screen, and then clicking “submit”) …would be appreciated!

Otherwise I receive no compensation for the work.

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Thank you,

Lane

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I hold a law degree, with concentration in Tax Law, Estate law & Corporate law, a Master’s Degree, with specialization in financial accounting & tax, a BBA, and CFP & CRPS designations, as well - I’ve been providing financial, Social Security/Medicare, estate, corporate, non-profit, and tax advice, since 1986