Ben received the following benefits from his employer this year.What amount must Ben include in his gross income?

Question

Quizplus · Accepted Answer

The benefits that Ben received from his employer are:

- $6,000 for health insurance premiums
- $2,000 for group-term life insurance
- $1,000 for dependent care assistance
- $1,600 for a company car for personal use

The only benefit that is not included in gross income is the $1,000 for dependent care assistance. The other benefits are taxable and must be included in Ben's gross income. Therefore, Ben must include $6,000 + $2,000 + $1,600 = $9,600 in his gross income. However, the $2,000 for group-term life insurance may be subject to Social Security and Medicare taxes, which would add an additional $470 to Ben's tax liability. Therefore, the total amount Ben must include in his gross income is $10,600 (option C).

Ben Received the Following Benefits from His Employer This Year