An employer may use this policy to help maintain reasonable limits on business expenses and ensure compliance with the employment tax laws. Not all business expenses may be reimbursed tax-free, and even tax-free reimbursements may become subject to withholding if employees do not substantiate their expenses within a reasonable time period.
This resource will assist an employer in drafting a business expense reimbursement policy that helps ensure employees understand exactly which types of expenses are reimbursable and which are not. It will also help ensure compliance with applicable employment tax laws.
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