Originally Posted by
Adlerdriver
Payroll deductions for travel bank shortage are not pre-tax. If they were, they would look like our 401K and Healthcare spending account deductions and have a "&" to the left of "DevBank" under Deductions on our earnings statement.
Lag, this isn't a deductibility question - I know a commute to domicile for a trip or training isn't a deductible business expense. Since we got the "yes/no" check box on the expense report, we're now required to report any commuting expenses Fedex pays on our behalf as taxable income.
If you check the "yes" box on a $200 airline ticket to MEM, you're going to end up paying $56 to the IRS (assuming 28% bracket). That $56 is going to be part of the money deducted from your paycheck under Fed Withholding. If you end up having to cover $100 of that expense with your own money via payroll deduction, then you've been over-charged on your taxes by $28.
I was just wondering if there was a way to handle this situation effectively during the submission of the expense report or are most people just taking care of the discrepancy during the filing process.
Q: Have you actually done the math and been charged on out of pocket funds as in your example?
The reason I ask, is that years ago when this new procedure came into being I asked the same question of the Company and I recall the answer was that they deduct all non taxable expenses from the bank first and then the taxable, and if their is a bank overage then the imputed taxes are only applied to the amount actually covered by Company money.