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Business and Finance

Employee Meals and/or Lodging Furnished by Purdue University (VPBS 182)

PURDUE UNIVERSITY
OFFICE OF THE BUSINESS MANAGER AND ASSISTANT TREASURER
WEST LAFAYETTE, INDIANA 47907

December 1, 1989

To: Vice Presidents, Deans, Directors, and Heads of Schools, Divisions, Departments and Offices, and Regional Campus Chancellors

Re: Business Office Memorandum No. 182
(Supersedes Memorandum 158, dated July 26, 1974)

Employee Meals and/or Lodging Furnished by Purdue University

BACKGROUND

The Tax Reform Act of 1986 has facilitated a review of the tax liability of employees and the University for meals and lodging provided by the University. Our review has confirmed that the law and subsequent regulation from the Internal Revenue Service did not change. However, the inclusion of the value of employer provided meals and lodging has changed over the years in relation to the determination of staff benefits as has the positions required to accept meals and/or lodging as a condition of employment. This memorandum reaffirms the University's basic policy regarding meal and lod 'ng perquisites and updates the listing 91 of benefits affected.

Section 119 of the Internal Revenue Code of 1986 states as follows:

  1. The value of meals furnished to an employee by the employer shall be excluded from the employee's gross income if two criteria are met:
    1. The meals are furnished on the business premises of the employer, and
    2. The meals are furnished for the convenience of the employer.
  2. The value of lodging furnished to an employee by the employer shall be excluded from the employee's gross income if three criteria are met:
    1. The lodging is furnished on the business premises of the employer,
    2. The lodging is furnished for the convenience of the employer, and
    3. The employee is required to accept such lodging as a condition of employment.
POLICY

A list of employees in positions required to accept lodging on the University premises and/or required to eat some or all of their meals on said premises will be maintained by the Department of Personnel Services on the West Lafayette campus and by the Regional Campus Personnel offices for other respective campuses. The list of positions will be published in the Business Procedures manual.

Under Section 119 of the Internal Revenue Code, the value of meals or lodging in such positions will not be subject to the withholding of federal, state, and county income tax.

The value of lodging will be included in the gross salary to determine Group Insurance entitlement and TIAA/CREF Contributions (for exempt employees only).

Questions concerning meals and lodging perquisites should be directed to the Department of Personnel Services on the West Lafayette campus or the Regional Campus Personnel Offices.

Howard Lyon
Vice President for Business Services and
Assistant Treasurer