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Taxation of Employee Benefits: Connecticut

Taxation of Employee Benefits requirements for other states

Federal law and guidance on this subject should be reviewed together with this section.

Author: Vicki M. Lambert, The Payroll Advisor


  • Salary deferrals to IRC § 125 cafeteria plans are taxable for unemployment insurance purposes in Connecticut. See Salary Deferrals to IRC § 125 Cafeteria Plans and § 401(k) Plans.
  • Based on the US Supreme Court ruling in Obergefell v. Hodges, the value of health insurance benefits provided to an employee's same-sex spouse is not subject to income tax withholding. Certain same-sex civil unions were automatically converted to marriages in 2010 and the civil union laws were repealed. See Same-Sex Couple Health Insurance Benefits.