It’s rare that the IRS seems to help businesses and taxpayers. Because fuel costs have increased, among other reasons, the IRS increased its optional business mileage standard on July 1. The figure is generally evaluated annually, but seldom does the IRS make a change in the middle of the year. According to the IRS news release, the last such change was in 2011. If the IRS is trying to help Americans and businesses who are feeling the crunch of inflation, employers must consider how to incentivize workers to keep coming to the office in a tight labor market.
How are offices responding to inflation?
According to Inc.com, That’s It is offering $100 gas cards for employees in June, July, and August. Many employers are keeping their employees remote or offering a hybrid plan to reduce gas costs for their employees. Flexible schedules that reduce commute time can also help with rising gas prices. Zenefits recommends a cash benefit or temporary increase for employees, but there are a few things to remember. First, gas cards or cash bonuses are considered taxable income. They must be reported on the worker’s W-2 form. In addition, offer bonuses across the board. If you only offer benefits to one set of employees, i.e. those who drive, you may be unintentionally discriminating against a protected class. Those who don’t drive, people with disabilities, may be able to claim disparate treatment.
Bottom line – don’t lose valuable staff to inflation
It’s been said that it’s easier to get a salary increase by job-hopping. In this tight job market, many people are leaving good jobs that don’t pay well just to find another position that pays more. You may not be able to match huge salary raises, but you can help employees find solutions to the high cost of their commute.