Employee Discounts?Know What's TaxedIn Seconds

Great question! Our calculators run entirely in your browser - no servers needed. But advanced features like saving employee records, tracking benefits across pay periods, generating reports, and syncing with payroll systems require backend infrastructure. That means servers running 24/7, secure databases to store your data, computing power to process and extract information, and engineering time to build and maintain these systems. These costs are real, so we charge for premium features that require them.

We use the exact IRS rules from Publication 15-B. Each calculator shows the relevant IRC section (like IRC §132(c) for employee discounts), a breakdown of the values used in the calculation, and links directly to IRS Publication 15-B so you can verify the rules yourself. We update our calculations every tax year when IRS limits change.

Imputed income is the taxable value of a non-cash benefit. If you give an employee a $50 discount beyond IRS limits, they saved $50 of real money. The IRS treats that savings as taxable income - it gets reported to payroll and appears on their W-2 just like regular wages.

No. We calculate the numbers, but we don't file anything. Take your results to your payroll company or accountant. They'll handle reporting it properly on W-2s and tax filings.

Send the imputed income amount to your payroll company (Gusto, ADP, Paychex, etc). They'll add it to the employee's taxable wages and withhold the right taxes automatically. That's it - you're done!

The free calculators keep everything on your device - we never see your data. Your calculations stay completely private. If you upgrade to premium features, you can optionally save employee records securely in our encrypted database for easier tracking and reporting.