About the Show

Anchored by Jake Tapper, The Lead airs at 4 p.m. ET on CNN.

Anchored by Jake Tapper, The Lead airs at 4 p.m. ET on CNN.

On the Next Episode of The Lead

We've moved! Come join us at our new show page.

We've moved! Come join us at our new show page.

April 9th, 2013
06:24 PM ET

Government wants to tax Google's employee perks

The cushy life out in the expansive offices of Silicon Valley comes with lots of bonuses, not all of them cash.

"I love massages. I'm a spa queen," says one employee in a Google company video. "We have yoga. We have pilates," says another.

But there's no such thing as a free lunch. Big tech companies are in fierce competition to attract top talent, and publicize their perks all over the recruitment pages of their websites.

"The food here by the way is great," says yet another Google employee in that company promo. "There is any type of amazing cuisine, even better than some of the restaurants in New York."

As the April 15 tax deadline nears, the Wall Street Journal reports there is a debate loming about whether all those freebies should to be taxable.

The IRS has stringent guidelines on what employers can feed their employees. The test of whether those meals count as income is a matter of convenience. If you work on an oil rig in the middle of the Gulf of Mexico, you cannot exactly run out for the burger. So the tax man says your company can feed you tax-free. But tech companies are often in places with plenty of restaurant options.

But companies like Facebook heavily promote their work culture, and perks are a large a part of that.

"I really feel like Facebook sometimes is a utopia in like the best of ways. The cool thing about the Facebook approach to benefits is, you know, like they're really focused on removing stress from our daily lives, so it's things that make it easier for me to focus," says a Facebook employee in a company video.

Being together, working together – and, yes, eating together.

Tax attorney Tom Cryan says the IRS has been investigating company perks for years, like the way high-level executives fly on corporate jets for personal use. But meals for the common techie has not been a target until recently.

"It hasn't been seen as this big abuse area," said Cryan. "But the law's the law, so they're going to look into this when they audit you, and the dollars can be huge depending on the size of the company."

Posted by ,
Filed under: Money Lead
soundoff (No Responses)

Post a comment


CNN welcomes a lively and courteous discussion as long as you follow the Rules of Conduct set forth in our Terms of Service. Comments are not pre-screened before they post. You agree that anything you post may be used, along with your name and profile picture, in accordance with our Privacy Policy and the license you have granted pursuant to our Terms of Service.