--- title: 5 Fringe Benefits Changes That Affect Employers description: In the Tax Cuts and Jobs Act changes were made to qualified transportation plans, moving expense reimbursements, employer-provided meals, and more. image: https://blog.axcethr.com/hubfs/Stock%20images/Beautiful%20woman%20standing%20with%20arms%20folded%20with%20colleagues%20on%20background.jpeg --- - [Client Portal](https://www.axcethr.com/client-services/) - [Employee Login](https://www.axcethr.com/client-services/) [![AxcetHR Solutions Blog](https://blog.axcethr.com/hubfs/AxcetHR2021%20Blog/axcethr_logo_white%20(1).png)](https://www.axcethr.com/) - [About Us](https://www.axcethr.com/about-us/) - [Corporate Philantropy](https://www.axcethr.com/about-us/corporate-philanthropy/) - [Meet the Team](https://www.axcethr.com/about-us/meet-the-team/) - [Values and Culture](https://www.axcethr.com/about-us/values-and-culture/) - [Kansas PEO](https://www.axcethr.com/about-us/kansas-peo/) - [Missouri PEO](https://www.axcethr.com/about-us/missouri-peo/) - 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[Human Resources](https://blog.axcethr.com/topic/human-resources) - [Payroll Administration](https://blog.axcethr.com/topic/payroll-administration) - [Employee Safety & Risk Management](https://blog.axcethr.com/topic/employee-safety-risk-management) - [Employee Benefits](https://blog.axcethr.com/topic/employee-benefits) - [All about COVID-19 in the Workplace](https://blog.axcethr.com/topic/covid19) - [Kansas & Missouri HR News](https://blog.axcethr.com/topic/kansas-and-missouri-hr-news) - [Kansas City Interest News](https://blog.axcethr.com/topic/kansas-city-interest-news) - [PEO/HRO](https://blog.axcethr.com/topic/peo) - Choose Topic: - [Human Resources](https://blog.axcethr.com/topic/human-resources) - Payroll Administrations - [Employee Safety & Risk Management](https://blog.axcethr.com/topic/employee-safety-risk-management) - [Employee Benefits](https://blog.axcethr.com/topic/employee-benefits) - [PEO](https://blog.axcethr.com/topic/peo) # 5 Fringe Benefits Changes That Affect Employers By [Herman McDaniel](https://blog.axcethr.com/author/herman-mcdaniel) on [Dec 17, 2018](https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers) 2 min read [0 comment(s)](https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers#comments-listing) Share this: - - - - [whatsapp://send?text=https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers](whatsapp://send?text=https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers) - [mailto:?subject=5%20Fringe%20Benefits%20Changes%20That%20Affect%20Employers&body=https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers](mailto:?subject=5%20Fringe%20Benefits%20Changes%20That%20Affect%20Employers&body=https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers) ![businessman hand working with new modern computer and business strategy as concept-1](https://blog.axcethr.com/hs-fs/hubfs/Stock%20images/businessman%20hand%20working%20with%20new%20modern%20computer%20and%20business%20strategy%20as%20concept-1.jpeg?width=1000&name=businessman%20hand%20working%20with%20new%20modern%20computer%20and%20business%20strategy%20as%20concept-1.jpeg) The IRS reminds employers that several programs have been affected as a result of the Tax Cuts and Jobs Act passed last year. This includes changes to fringe benefits, which can affect an employer's bottom line and its employees' deductions. Learn more about these five changes that will affect employers: ## 1. Entertainment Expenses & Deduction for Meals The new law generally eliminated the deduction for any expenses related to activities generally considered entertainment, amusement or recreation. However, under the new law, taxpayers can continue to deduct 50 percent of the cost of business meals if the taxpayer or an employee of the taxpayer is present, and the food or beverages are not considered lavish or extravagant. The meals may be provided to a current or potential business customer, client, consultant or similar business contact. Food and beverages that are purchased or consumed during entertainment events will not be considered entertainment if either of these apply: - - they are purchased separately from the entertainment - the cost is stated separately from the entertainment on one or more bills, invoices or receipts ## 2. Qualified Transportation The new law also disallows deductions for expenses associated with qualified transportation fringe benefits or expenses incurred providing transportation for commuting. There is an exception when the transportation expenses are necessary for employee safety. ## 3. Bicycle Commuting Reimbursements Under the new law, employers can deduct qualified bicycle commuting reimbursements as a business expense. The new tax law suspends the exclusion of qualified bicycle commuting reimbursements from an employee’s income. This means that employers must now include these reimbursements in the employee’s wages. [![New call-to-action](https://no-cache.hubspot.com/cta/default/2652187/83ca9875-ba2d-4aa9-8a6d-137bb43975a4.png)](https://cta-redirect.hubspot.com/cta/redirect/2652187/83ca9875-ba2d-4aa9-8a6d-137bb43975a4) ## 4. Qualified Moving Expenses Reimbursements Employers must now include moving expense reimbursements in employees’ wages. The new tax law suspends the exclusion for qualified moving expense reimbursements. There is one exception as members of the U.S. Armed Forces can still exclude qualified moving expense reimbursements from their income if they meet certain requirements. ## 5. Employee Achievement Award Special rules allow an employee to exclude achievement awards from their wages if the awards are tangible personal property. An employer also may deduct awards that are tangible personal property, subject to certain deduction limits. The new law clarifies the definition of tangible personal property. [Learn more on how the Tax Cuts and Jobs Act Affects Business.](https://blog.axcethr.com/how-the-tax-cuts-and-jobs-act-affects-businesses) [![New call-to-action](https://no-cache.hubspot.com/cta/default/2652187/bb8b8bf9-4a4b-4e3f-9d49-d92d1913a3f7.png)](https://cta-redirect.hubspot.com/cta/redirect/2652187/bb8b8bf9-4a4b-4e3f-9d49-d92d1913a3f7) [![Herman McDaniel](https://blog.axcethr.com/hs-fs/hubfs/Herman_Final-11.jpg?width=80&height=80&name=Herman_Final-11.jpg)](https://blog.axcethr.com/author/herman-mcdaniel) Written by #### [Herman McDaniel](https://blog.axcethr.com/author/herman-mcdaniel) Herman McDaniel is a Payroll Administrator at Axcet HR Solutions, where he partners closely with clients to ensure payroll is processed accurately, efficiently, and in compliance with ever-changing regulations. With more than 19 years of experience in this role, Herman brings deep expertise and a steady, reliable presence to the businesses he supports. Herman serves as the dedicated payroll contact for his clients, managing the full payroll process from data review and verification to posting and delivery. He works directly with both employers and employees to answer questions, resolve issues related to payroll taxes, deductions, and compliance, and ensure every detail is handled with precision. In addition to processing payroll, Herman plays a key role in onboarding new clients, conducting payroll training, and supporting ongoing client relationships through regular communication and proactive service. He also assists with benefits administration, paid time off tracking, and system updates—helping ensure payroll and HR data remain accurate and aligned across platforms. Known for his attention to detail and commitment to client service, Herman focuses on creating consistent, dependable payroll processes while identifying opportunities to improve efficiency and accuracy. His long tenure gives him a unique understanding of client needs and the ability to anticipate challenges before they arise. Through his writing, Herman shares practical insights on payroll processes, compliance considerations, and best practices—helping employers feel confident in one of the most critical functions of their business. Read more [View all posts →](https://blog.axcethr.com/author/herman-mcdaniel) ### Get HR Updates ### Table of Contents #### [The Quagmire of HR Compliance Can Make or Break Smaller Companies ![The Quagmire of HR Compliance Can Make or Break Smaller Companies](https://blog.axcethr.com/hubfs/Stock%20images/Young%20business%20people%20working%20in%20office.jpeg)](https://blog.axcethr.com/the-quagmire-of-hr-compliance-can-make-or-break-smaller-companies) #### [![IRS Releases Updated Withholding Form for 2019](https://blog.axcethr.com/hubfs/Stock%20images/Group%20of%20happy%20young%20%20business%20people%20in%20a%20meeting%20at%20office-1.jpeg) IRS Releases Updated Withholding Form for 2019](https://blog.axcethr.com/irs-releases-updated-withholding-form-for-2019) ## Let us know what you think... ![AxcetHR Blog](https://blog.axcethr.com/hubfs/AxcetHR2021%20Blog/axcethr_logo_white%20(1).png) - [Why Axcet](https://www.axcethr.com/why-axcet/) - [What We Stand For](https://www.axcethr.com/about-us/what-we-stand-for/) - [Expertise](https://www.axcethr.com/expertise/) - [Employee Benefits](https://www.axcethr.com/services/employee-benefits/) - [Human Resources](https://www.axcethr.com/services/human-resources/) - [Payroll Services](https://www.axcethr.com/services/payroll-and-tax-administration-services/) - [Risk Management](https://www.axcethr.com/services/workers-comp-and-employee-safety-risk-management/) - [Meet the Team](https://www.axcethr.com/about-us/meet-the-team/) - [Subscribe to Latest Resources](https://www.axcethr.com/subscribe-to-the-latest-resources/) - [Resource Library](https://www.axcethr.com/expertise/resource-library/) - [\[ Client Portal \]](https://www.axcethr.com/client-services/) - - - - - Search for: Copyright © 2023 Axcet HR Solutions – Kansas City's PEO Since 1988 | [Privacy Policy](https://www.axcethr.com/privacy-policy/) | [Terms and Conditions](https://www.axcethr.com/terms-conditions/) | [**Join our Team – Careers »**](https://axcethrsolutions.prismhr-hire.com/) 10975 Grandview Drive Suite 200, Corporate Woods Building 27, Overland Park, KS 66210 | Call us: 913-383-2999 *The IRS does not endorse any particular For more information on [certified professional employer organizations](https://www.axcethr.com/why-axcet/certified-peo/), go to [www.irs.gov](https://www.irs.gov).* Remove cookies ![](https://dc.ads.linkedin.com/collect/?pid=43031&fmt=gif) ```json { "@context" : "https://schema.org", "@type" : "BlogPosting", "author" : { "@type" : "Person", "name" : "Herman McDaniel", "url" : "https://blog.axcethr.com/author/herman-mcdaniel" }, "dateModified" : "2025-05-01T21:31:24.221Z", "datePublished" : "2018-12-17T14:07:46.000Z", "headline" : "5 Fringe Benefits Changes That Affect Employers", "image" : [ "https://blog.axcethr.com/hubfs/Stock%20images/Beautiful%20woman%20standing%20with%20arms%20folded%20with%20colleagues%20on%20background.jpeg" ], "mainEntityOfPage" : { "@id" : "https://blog.axcethr.com/5-fringe-benefits-changes-that-affect-employers", "@type" : "WebPage" }, "publisher" : { "@type" : "Organization", "logo" : { "@type" : "ImageObject", "url" : "https://blog.axcethr.com/hubfs/_logo_axcethr_primary.png" }, "name" : "Axcet HR Solutions" } } ``` ```json { "@context" : "https://schema.org", "@id" : "https://www.axcethr.com/#organization", "@type" : "Organization", "address" : { "@type" : "PostalAddress", "addressCountry" : "US", "addressLocality" : "Kansas City", "addressRegion" : "MO" }, "aggregateRating" : { "@type" : "AggregateRating", "bestRating" : "5", "ratingValue" : "5", "reviewCount" : "100" }, "areaServed" : { "@type" : "Country", "name" : "United States" }, "award" : [ "IRS Certified Professional Employer Organization (CPEO)", "Award-Winning HR Solutions Provider", "SHRM Certified HR Professionals", "HRCI Certified HR Professionals" ], "contactPoint" : { "@type" : "ContactPoint", "areaServed" : "US", "availableLanguage" : "English", "contactType" : "Customer Service" }, "description" : "Award-winning Professional Employer Organization (PEO) providing comprehensive HR solutions, payroll services, employee benefits, and risk management to small and mid-sized businesses. 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This includes changes to fringe benefits, which can affect an employer's bottom line and its employees' deductions. Learn more about these five changes that will affect employers: 1. Entertainment Expenses & Deduction for Meals The new law generally eliminated the deduction for any expenses related to activities generally considered entertainment, amusement or recreation. However, under the new law, taxpayers can continue to deduct 50 percent of the cost of business meals if the taxpayer or an employee of the taxpayer is present, and the food or beverages are not considered lavish or extravagant. The meals may be provided to a current or potential business customer, client, consultant or similar business contact. Food and beverages that are purchased or consumed during entertainment events will not be considered entertainment if either of these apply: they are purchased separately from the entertainment the cost is stated separately from the entertainment on one or more bills, invoices or receipts 2. Qualified Transportation The new law also disallows deductions for expenses associated with qualified transportation fringe benefits or expenses incurred providing transportation for commuting. There is an exception when the transportation expenses are necessary for employee safety. 3. Bicycle Commuting Reimbursements Under the new law, employers can deduct qualified bicycle commuting reimbursements as a business expense. The new tax law suspends the exclusion of qualified bicycle commuting reimbursements from an employee’s income. This means that employers must now include these reimbursements in the employee’s wages. 4. Qualified Moving Expenses Reimbursements Employers must now include moving expense reimbursements in employees’ wages. The new tax law suspends the exclusion for qualified moving expense reimbursements. There is one exception as members of the U.S. Armed Forces can still exclude qualified moving expense reimbursements from their income if they meet certain requirements. 5. Employee Achievement Award Special rules allow an employee to exclude achievement awards from their wages if the awards are tangible personal property. An employer also may deduct awards that are tangible personal property, subject to certain deduction limits. The new law clarifies the definition of tangible personal property. 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