Solutions to Chapter 4 Problems
d. $3,000. Tom is a key employee and the plan is discriminatory so he must include in income the greater of the actual premiums ($3,000) or the $1,676.40 computed from the table without excluding the first $50,000 (110 increments x $1.27 table rate x 12 months = $1,676.40). 20. Fringe Benefits under Cafeteria Plan ................
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