Does the taxpayer recognize gross income in the following situations? a. Ava is

Question

Does the taxpayer recognize gross income in the following situations?

a. Ava is a filing clerk at a large insurance company. She is permitted to leave the premises for lunch, but she usually eats in the company's cafeteria because it is quick and she is on a tight schedule. On average, she pays $2 for a lunch that would cost $12 at a restaurant. However, if the prices in the cafeteria were not so low and the food was not so delicious, she would probably bring her lunch at a cost of $3 per day. Ava's meals are provided as a convenience for the employee.

Therefore, Ava would include $______ per meal in her gross income?

Explanation / Answer

Ava, is required to file her tax report.

She has to include $10 per meal (as per the given examples) in her gross income.

If Ava brings her lunch from outside she need not to claim any additional amount because she is not taking any voluntary benefit.

Ava would include $10 per meal in her gross income

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