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11.17.08 Personal Use of Business Vehicle
In a recent survey we conducted, over a quarter (28 percent) of organizations allow employees to use employer-provided vehicles for personal reasons. This means an extra year-end T&E-related task AP needs to handle. That’s because a worker's personal use of an employer-provided vehicle is a taxable fringe benefit in most cases. So employers that allow workers to make personal use of company cars generally are required to determine the value of this personal use and inform payroll so that it can be included in employees' wages. The value of a worker's personal use of a company car generally is treated as taxable compensation — i.e., subject to federal income taxes, as well as social security and unemployment taxes.
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11.07.08 Test Your AP IQ: Temporary Housing
An employee submits an expense report that includes a hotel charge for $2,000. The business reason given is “temporary living expenses for new job.” Upon investigation, you find that this is a new employee who had to relocate. After he started his new job, he still did not have a place to live, so he was allowed to stay at a hotel temporarily. The employee put the charge on a corporate travel card that was issued to him by your organization (AP pays the credit card statement). You get a W-9 from the hotel that indicates that it is organized as a partnership. On what form (or forms) is this transaction reported at year-end?
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10.24.08 Test Your AP IQ: T&E for Temporary Travel
Mary was sent out of town on what was expected to be a temporary assignment of eight months to complete a project. She submits expense reports for travel expenses and the reimbursement is tax-free because the assignment is temporary. After seven months, it appears that Mary will likely stay six more months. In light of this extension, does the tax-free status of her reimbursement change? more...
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10.22.08 Advanced Tool Closes T&E Loophole
Up to now, if an employee booked travel that was in line with organization policy and then upgraded beyond policy while on the road, you’d be hard pressed to catch this after the fact. You’d have to go through expense reports manually and compare actual spending with what was originally booked. Now, automated T&E systems are offering stronger tools to help close this loophole.
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10.15.08 End-to-End T&E System is Best
Organizations are improving their management of travel and entertainment (T&E) expenses through the increased use of automated “end-to-end” solutions that link together disparate processes and data, according to new research from the Aberdeen Group.
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10.07.08 Dust Off Those T&E Policy Manuals
“The T&E policy and procedures manual is the most important way to manage and control travel and entertainment expenses,” says IOMA’s revised 2008 version of the Complete Guide to AP Best Practices. This statement is backed up by new research from the Aberdeen Group, which found that establishing formal T&E policies and processes is the most cited strategy to improve T&E management. more...
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10.03.08 Test Your AP IQ: Payments to Employees
When making payments to employees for things such as T&E, some organizations run these payments through the payroll system. From AP’s perspective, what is the advantage of doing this? more...
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09.30.08 Dealing With T&E Fraudsters
AP should put a policy in place that calls for the termination of employees who commit fraud, according to IOMA’s revised 2008 version of the Complete Guide to AP Best Practices. This can be an effective deterrent. However, for the policy to have teeth, you have to follow through on it. Office supplies giant Staples did just that—as a new court cast illustrates.
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09.29.08 IRS Issues New “High-Low” Per Diems
The Internal Revenue Service has issued new “high-low” per diems for lodging, meals & incidentals. Under this method, there’s a list of localities that are classified as "high-cost" areas—all other localities are deemed "low-cost" areas. There’s one per diem rate for high-cost areas and another for low-cost areas. These simplified rates can be used in lieu of the hundreds of city-by-city rates.
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09.02.08 Risk of Online T&E Booking
More organizations are requiring traveling employees to use online booking tools to arrange their trips, according to a new study from Travel & Entertainment Magazine. Almost half (47 percent) of traveling employees polled say they are expected to use online booking, versus just 25 percent when the survey was done four years ago. more...
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08.25.08 SIFL Rates Increase for 2H08
All the Standard Industry Fare Level (SIFL) formula rates have increased for the second half of 2008 (July 1 through December 31).
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08.25.08 >>>Benchmark Your AP Operations<<<
How much does it cost AP departments to process an invoice? How many invoices should AP staffers be able to process in a month? What is the average error rate for payments? You will get the answers to these questions--and a lot more—if you take part in our survey. more...
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08.18.08 New Per Diems Effective Oct. 1
Effective Oct. 1, 2008, the standard per diem rate for business travel within the continental United States will remain at $109 ($70 for lodging, $39 for meals and incidental expenses), the General Services Administration has announced. For specifically listed localities, the lodging rate will range from a low of $70 to a high of $360, depending on locality. The rates for meals and incidental expenses will remain the same, ranging from $39 to $64. There are about 400 locations in the continental United States with a lodging per diem that is higher than the national standard rate.
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08.14.08 >>> AP Benchmarking Survey Now Open <<<
How much does it cost AP departments to process an invoice? How many invoices should AP staffers be able to process in a month? What is the average error rate for payments? You will get the answers to these questions--and a lot more—if you take part in our AP Benchmarking Survey. We’ll send you the results so you can see how your AP department stacks up against all the others.
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07.28.08 Call to Ease Tough Biz Cell Phone Rules
More than 30 companies and associations signed a July 10 letter to Senate Finance Committee Chairman Max Baucus (D-Mont.) and ranking member Charles Grassley (R-Iowa) supporting proposed legislation that would eliminate the requirement that employees track and substantiate the use of employer-provided cell phones in order for their value to be excluded from income.
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07.25.08 Test Your AP IQ: Accounting for Travel Advances
If an employee does not account for a travel advance within a “reasonable period of time” after the expense has been paid or incurred, the amount must be included on the employee’s W-2 form as taxable income. What is this “reasonable period of time?”
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07.21.08 Tool Reimbursements Taxable, Says the IRS
After years of scrutiny and enforcement of the issue, the Internal Revenue Service said in formal guidance that amounts paid to employees under motor vehicle industry specialized tool and equipment plans are subject to employment taxes.
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07.11.08 Test Your AP IQ: Business Mileage Rate
The standard business mileage rate can be used to reimburse employees for using their personal vehicles for business purposes. Which of these costs is not embodied in the standard mileage rate? more...
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07.07.08 Mileage Reimbursement Tax Trap
The Internal Revenue Service recently increased the optional business standard mileage rates from 50.5 cents per mile to 58.5 cents per mile effective July 1. This is the rate you can reimburse employees on a tax-free basis for the business use of their personal cars. But employees may have a tax issue if employers reimburse for less than the standard rate.
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06.24.08 FLASH: IRS Ups Mileage Rates Effective July 1
The Internal Revenue Service announced yesterday an increase in the optional standard mileage rates for the final six months of 2008, according to a news release [IR-2008-82] and an accompanying announcement [Announcement 2008-63].
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06.23.08 New Proposed Regs on Biz Car Usage
When employees use business cars for personal use, the value of the personal use is generally considered taxable income to the employees. However, there’s no tax if the vehicle is a so-called “qualified nonpersonal use vehicle.” Under new proposed regulations from the Internal Revenue Service, "clearly marked" public safety officer vehicles would be added as a new type of qualified nonpersonal use vehicle. That means, for example, that public safety officers and other first responders would be able to take their vehicles home tax-free. What’s more, they don’t even have to be employed by a police or fire department to qualify for the tax-free treatment—as long as the vehicles are clearly marked. more...
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06.20.08 Test Your AP IQ: One-Card Program
How familiar are you with AP rules, regulations, and best practices? Here’s a question to test your knowledge: What is the primary advantage of a “one-card” program (combined procurement card, travel card, and sometimes a fleet card)?
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06.02.08 Proposed Hike in Mileage Rates
Sen. Charles Schumer (D-N.Y.) has introduced a bill (S. 3032) that would increase the standard mileage rate for 2008 tax deductions on automobiles used for business, medical, and moving purposes, and permanently increase the rate for charitable deduction purposes.
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05.14.08 T&E System is Most Essential Data Source
In the past, we have made the point that one of the biggest benefits of an automated system for reimbursing employees for travel and entertainment (T&E) expenses is the data that an automated system can provide. The information can be sliced and diced and used to analyze T&E spending and to negotiate discounts with airlines, hotels, and other T&E providers. Recent research from the Aberdeen Group confirms this. more...
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04.28.08 How AP Pros Tweaked T&E Due to SOX
The review and approval process for employee reimbursements for travel and entertainment (T&E) expenses was the most cited area that needed changes because of the Sarbanes-Oxley Act (SOX), according to a recent survey we conducted.
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04.23.08 Scanning T&E Receipts
One out of four organizations we recently polled say they require expense report receipts to be scanned for imaging. According to preliminary results of our survey of travel and entertainment (T&E) expense reimbursement processing, 44 percent of organizations now require travelers to scan their receipts. This eliminates all of those annoying little scraps of paper receipts business travelers can amass. It also streamlines the process, enhances internal controls, and increases auditing effectiveness.
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04.09.08 More AP Depts. Have Automated T&E
More AP departments have moved away from paper-based, manual systems for processing employee expense reimbursements for travel and entertainment (T&E), reveals the preliminary results of our latest T&E survey. We received responses from over 400 AP pros about their T&E processing. more...
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04.07.08 Revised Per Diem Rates in Six States
After surveying lodging and meal prices in Alabama, California, Illinois, Missouri, New York, and Texas, the General Services Administration announced revisions to the per diem reimbursement rates for traveling in certain areas of those states, according to FTR Travel Bulletin 08-03.
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04.04.08 Test Your AP IQ: Automating T&E
How familiar are you with AP best practices, rules, and regulations? Here’s a question to test your knowledge: An automated travel and entertainment (T&E) system can reduce expense report preparation time by how much?
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03.03.08 SIFL Rates Increase for 1H08
All the Standard Industry Fare Level (SIFL) formula rates have increased for the first half of 2008 (January 1 through June 30).
What are the SIFL rates? When an employee makes personal use of company aircraft, the employee is generally taxed on the value of the use of the aircraft. The value is based on what it would have cost to charter a plane for the trip. An easier way to figure the value is to use the SIFL rates, which are issued every six months. The SIFL rates are used along with an Aircraft Multiple based on the weight of the aircraft and whether the employee is a “control employee” or not. A control employee is a high-paid officer of the company. Also, a Terminal Charge is added.
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