gringo

I'm listed as an "enrolled friend" on a friends travel benefit package. The question I have is, is the imputed income based off of a base fare, or does it vary depending on the class travel?

Meaning, is there a difference in imputed income if I take First Class vs Business Class vs Economy?

APC225

Tax laws and regulations govern whether an eligible pass rider’s travel is taxed as imputed income to the employee/retiree. Pass travel by domestic partners, enrolled friends and certain buddy pass riders is taxable and the employee/retiree is subject to tax and tax withholding on the value of that travel.

Calculating Tax Value:
The pass tax value equals 10% of the lowest Y fare in effect on the date of travel, minus the applicable service charge. If the service charge is equal to or greater than 10% of the Y fare, the tax value is zero.

Calculating Amount of Tax Withholding:
To calculate the amount of tax that will be withheld, take the pass tax value and multiply it by the total of the FICA rate and the federal tax rate. Example: $90.00 pass tax value X 32.65% (7.65% FICA rate plus 25%* federal tax rate) = $29.38 approximate tax withholding. To view federal and state income tax rates, visit Internal Revenue Service.
*25% is an average federal tax rate; it may be lower or higher based on tax bracket, with a maximum of 35%.