Opinion ID: 20383
Heading Depth: 1
Heading Rank: 3

Heading: meals and lodging as wages

Text: The first question we must address is whether the value of meals and lodging exempted from federal income taxation by section 119 of the Internal Revenue Code (“§ 119 Meals and 4 Lodging”)1 is included in “wages” under the LHWCA. The LHWCA provides: The term “wages” means the money rate at which the service rendered by an employee is compensated by an employer under the contract of hiring in force at the time of the injury, including the reasonable value of any advantage which is received from the employer and included for purposes of any withholding of tax under subtitle C of title 26 (relating to employment taxes). The term wages does not include fringe benefits, including (but not limited to) employer payments for or contributions to a retirement, pension, health and welfare, life insurance, training, social security or other employee or dependent benefit plan for the employee’s or dependent’s benefit, or any other employee’s dependent entitlement. 33 U.S.C. § 902(13) (1994). Subtitle C of title 26, the Internal Revenue Code, deals with employment taxes, three of which are withheld from the pay of employees. See I.R.C. §§ 3101(a), 3101(b) & 3201(a) (1994) (old-age, survivors, and disability insurance tax; hospital insurance tax; and railroad retirement tax, respectively). Each of these taxes is calculated based on wages, as defined in I.R.C. § 3121. See id. Since 1983, I.R.C. § 3121 has provided that “the term ‘wages’ . . . shall not include . . . the value of any meals or lodging furnished by . . . the employer if at the time of such furnishing it is 1 Section 119(a) of the Internal Revenue Code provides: There shall be excluded from gross income of an employee the value of any meals or lodging furnished to him, his spouse, or any of his dependents by or on behalf of his employer for the convenience of the employer, but only if (1) in the case of meals, the meals are furnished on the business premises of the employer, or (2) in the case of lodging, the employee is required to accept such lodging on the business premises of his employer as a condition of his employment.