Imputed pay, also known as imputed income, is the value of non-cash compensation given to employees in the form of fringe benefits, which is added to an employees taxable income. Imputed income is attributed to any taxable non-cash benefit or income an employee receives that is not part of their normal taxable wages. Examples of imputed income include:

• Use of a company or employer car
• Fitness benefits, like a free gym membership
• Dependent care assistance exceeding $5,000
• Group-term life insurance exceeding $50,000
• Moving expense reimbursement
• Education assistance exceeding $5,250
• Adoption assistance exceeding the annually adjusted amount
• Some employer gifts, mostly cash and gift cards
• Health insurance for non-dependents, such as a domestic partner

Imputed income is not subject to federal income tax withholding, but it is subject to Social Security taxes, federal unemployment taxes, and Medicare taxes. Employers must report imputed income on employees W-2 forms for federal income taxes.