Question

What tax advantage is offered relative to Sec. 132​ benefits?

Answer 1

Section 132 benefits provide tax advantages through the exclusion of certain fringe benefits from an employee's taxable income.

Step-by-step explanation:

A tax advantage offered relative to Section 132 benefits is the deferral of taxes until funds are withdrawn.

Section 132 benefits refer to certain fringe benefits provided by an employer to an employee, such as transportation, meals, or lodging, that are excluded from the employee's taxable income. These benefits can help reduce an employee's tax liability.

For example, if an employee receives a housing allowance as a Section 132 benefit, the value of the housing allowance is not included in their taxable income, therefore reducing their overall tax liability.