Add fringe benefits and report imputed pay

Fringe benefits are considered non-cash compensation and are taxed as regular wages. These taxable “wages” are called imputed pay, and are only added to gross wages for taxability purposes—this means team members will not receive the benefit amount as pay, but they'll be taxed on its value, and the benefit is received in another way (and considered part of compensation).

Imputed pay examples

If you do not know if you need to enter imputed pay in Gusto, work with an accountant to find the correct classification for your situation. Learn more about imputed pay on our blog.

Reimbursing employees for fringe benefits

If you need to reimburse your team for fringe benefits they've paid out of pocket, just keep in mind that reimbursements (regular, and expense) are not taxed and not reported as wages. Most times, if you're reimbursing an employee for a fringe benefit, you should also set up the fringe benefit in Gusto to make sure compensation is recorded accurately.