TAXES ON TRIVIAL ITEMS? 2: De Minimis Fringe Benefits

The IRS –applying the concept of de minimis non curat lex (the law is not interested in trivial matters)– allows exemptions for De Minimis Fringe Benefits: a de minimis benefit is one for which, considering its value and the frequency with which it is provided, is so small as to make accounting for it unreasonable or impractical. De minimis benefits are excluded under Internal Revenue Code section 132(a)(4) and include items which are not specifically excluded under other sections of the Code.

These include such items as:

Controlled, occasional employee use of photocopier
Occasional snacks, coffee, doughnuts, etc.
Occasional tickets for entertainment events
Holiday gifts
Occasional meal money or transportation expense for working overtime
Group-term life insurance for employee spouse or dependent with face value not more than $2,000
Flowers, fruit, books, etc., provided under special circumstances

In determining whether a benefit is de minimis, you should always consider its frequency and its value. An essential element of a de minimis benefit is that it is occasional or unusual in frequency. It also must not be a form of disguised compensation.

Shouldn’t the concept of de minimis be applied on all transactions of trivial amounts?

info from http://www.irs.gov/govt/fslg/article/0,,id=184791,00.html
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