Which is a "working condition" fringe benefit?

The correct answer is that a "working condition" fringe benefit is defined as a service that the employee could deduct as a business expense if they paid for it themselves. This classification is important because it recognizes that certain expenses incurred by employees for their job can be provided by employers without being counted as taxable income.

"Working condition" fringe benefits are typically those expenses that are necessary for the employee to perform their job duties effectively. If an employee were to pay for these benefits out of pocket, they would be allowed to deduct those expenses when filing their tax returns. Therefore, when an employer covers these costs, they do not count as taxable income to the employee, which adds value to the employee's overall compensation package without tax implications.

In contrast, the other options do not meet the criteria for "working condition" fringe benefits. Discounts offered to employees or services provided at reduced rates, although beneficial, do not pertain directly to the ability to deduct costs associated with job performance. Likewise, items of minimal value that are difficult to account for are categorized differently under tax law and are not related to the concept of business expense deductions. Thus, only the option related to deductibility as a business expense aligns with the definition of "working condition" fringe benefits.