JOON is used by companies big and small to streamline taxable and non-taxable benefits programs. This material has been prepared in partnership with Acru for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal, or accounting advice. You should consult your own tax, legal, and accounting advisors before engaging in any transaction.
<aside> 💡 Please note that JOON does not offer any pre-tax benefits. To better understand the differences between pre-tax, taxable, and non-taxable benefits and the corresponding tax impact, review these resources: • Accounting and Withholding Taxes for Fringe and Wellness Benefits • IRS Publication 15-B guide to Taxable Benefits • IRS Publication 535 guide to Non-Taxable Benefits
At the end of each month, JOON ****generates an invoice that includes the following information necessary for withholding taxes and accounting:
<aside> 💡 If a benefits recipient makes both eligible taxable and non-taxable purchases within a single benefits program, our report will automatically allocate their allowance toward non-taxable reimbursements to minimize tax liability.
<aside> 💡 Once the invoice is paid, JOON reimburses each benefits recipient on an employer’s behalf. Learn more about Invoicing & Reimbursements.
Reimbursements classified as taxable constitute taxable income, and should have taxes withheld on a cash basis (e.g. eligible purchases made in December ‘22 but reimbursed in January ‘23 are taxable in FY ‘23). Because the reimbursement is essentially taxable income, the IRS does not require documentation like a receipt. You therefore do not need to keep a record of every purchase for tax purposes, but are welcome to do so for HR administration purposes.
The tabs below provide steps you can take to administer tax withholdings and communicate the implications to your team so they know what to expect.
As a general rule, if the purchase would be considered a legitimate business expense, the employee can be reimbursed 100% without any tax consequences. Essentially the employee will have used their own funds for a business expense and should have some form of documentation (e.g. a receipt, purchase description, etc.) as proof of the purchase.
<aside> 💡 Please inform your JOON account manager about whether you want receipts required for non-taxable purchases. If so, purchases from connected cards will automatically be marked as eligible, but will require the benefits recipient to manually add a receipt in order to be reimbursed. Learn more about Eligible Purchases & Classification.