Employee Reimbursements Under An Accountable Plan

Generally amounts paid as reimbursements to employees for travel, medical and other expenses are deductible by the Company and not income to the employees. However, tax rules require that such payments be made under an "accountable plan" that requires the employee to properly account for the expenses in order to obtain reimbursement. Failure to have such a plan could lead to the employees having to pay tax on the reimbursements and penalties and headaches to the Company. Contact us if you need assistance with your accountable plan.