The Internal Revenue Service has determined that employer-provided cell phones are not taxable fringe benefits. That guidance was issued relating to a provision of the Small Business Jobs Act of 2010 that removed cell phones from the definition of listed property.

A simultaneous memo to IRS examiners was issued regarding the work-related use of personally-owned cell phones. When employers require employees to use personal cell phones for business purposes they reimbursement of expenses is nontaxable for reasonable cell phone use. The memo warned this does not apply to reimbursements for unusual or excessive expenses "made as a substitute for a portion of the employee's regular wages."