Randi, a ﬂight attendant, received wages of $30,000 in 2012. The airline provided transportation on a stand- by basis, at no charge, from her home in Detroit to the airline's hub in Chicago. The fair market value of the commuting ﬂights was $5,000. Also in 2012, Randi received reimbursements, under an accountable plan, of $10,000 for overnight travel, but only spent $6,000. The excess was returned. Randi became disabled in November 2012 and received worker's compensation of $4,000. What amount must Randi include in gross income on her 2012 tax return?

Question

Quizplus · Accepted Answer

Wages are all that would have to be included in gross income
 Amounts received under a worker's compensation agreement may be excluded from gross income, the value of no-additional-cost-services (free standby ﬂight) that employers provide to employees is excluded from income and employment tax, and employees who make adequate accounting of business expenses to employer may not take the deduction for such expenses because they are not required to report the reimbursements. Employers exclude reimbursements from actual wages.

Randi, a ﬂIght Attendant, Received Wages of $30,000 in 2012