Financial Counseling Services Are Income

[Guest tonimg]

PLR 9929043 concludes that financial counseling services provided to surviviors of terminally ill employees are income, which I agree with.

However, all the commentary I have read states that the same services, if provided to an employee, would be excludable under IRC Sec. 132. I thought these expenses would not be excludable under IRC Sec. 132 because they are Sec. 212 expenses.

Please let me know your thoughts, with cites if possible. Thanks.

[Guest G Burns]

I am puzzeled by your references. 212 deals with expenses related to production of income, maintenance etc of property and collection of tax. 132 deals with specifically listed fringe benefits.212 has no connection to 132. The services you mention are not listed. 3401 etc state that wages are compensation in any form except as specifically excluded, your item is not. Therefore it is income included in gross income.