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Good morning,
I tried Google but all responses take me to gift card taxation :/
We are paying severance to a (previous) employee who was also gifted their company vehicle ($25,500 value). I know I need to include this for tax purposes, so the value is included in their W2 wages, however, I'm not sure of the correct taxation. To note, this is a Pennsylvania based employee.
I know I need to add a 'prepaid' earning code so only the value is taxed, and the employee does not receive the actual dollar amount, but not sure what taxation applies. Would this be all taxes; SS, Med, Fed, State & PA Local?
Is someone able to point me in the right direction or suggest where I can find documentation?
Thanks in advance.