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- IRS code section 274and associated publications address entertainment-related meals and expenses. This section indicates that such meals and expenses are not reimbursable unless it is established that the expense is directly related to the active conduct of business. Birthday lunches, birthday flowers, or birthday gifts are considered personal in nature and not business related, therefore not allowable. There are exceptions to the rules which include infrequent events for employees (perhaps an annual holiday or unit gathering), and flowers for funerals or illness.
- Rental cars should be utilized when traveling long distances instead of driving a personal vehicle and requesting mileage reimbursement.
- For clarification purposes, “Mini Bar” expenses include alcohol, snacks, bottled water, candy, etc., which are considered non-allowable expenses.
- Alcohol should be considered a personal expense unless a valid university business entertainment purpose is documented with external business constituents (i.e. donors).
- Reminder: IRS considers food/snacks for meetings as non-allowable whether it includes faculty, staff or students unless it is very infrequent (i.e. once a semester).
- IRS Tax Topic 511 – Business Travel Expenses - considers facilities within the same city as an extension of the place of business therefore mileage reimbursement between these locations would be considered non allowable (i.e. Peoria Next, Civic Center, Shea Stadium, etc.).
- All requests for travel reimbursements must have a copy of the travel pre-approval attached. In the event, the travel amount exceeds the original pre-approval amount it will be necessary to secure additional approval (Provost) for the overage.
- Cash advances for foreign travel per diem is allowed only if the travel is for 10 days or more. If travel is less than 10 days, employees may request per diem as a reimbursement (after the travel has taken place) with appropriate approvals and in accordance with established policies and procedures.
- There is no reimbursement or expense allowed for meals on a one-day trip unless the trip exceeds 10 hours.
- Mileage requests must be substantiated with an odometer reading or a map quest.
Travel and/or expense reimbursement policy
Revised, effective March 1, 2006
- Bradley VISA documentation
- Travel on Restricted Funds
- Foreign Travel
- Miscellaneous reimbursable travel expenses
- Non reimbursable travel expenses
The basic rationale underlying all university travel regulations is that we should incur the lowest practical and reasonable expense while completing the travel in an efficient and timely manner. Persons traveling on University business have the duty to exercise care to avoid impropriety, or even the appearance of impropriety, in any travel expense. Reimbursement is allowed for ordinary and necessary traveling expenses incurred by an employee while away from home in the conduct of university business. “Home” is considered to be the locale of Bradley University. Individuals are not “away from home” unless their duties require them to be away from the University for a period substantially longer than an ordinary workday and it is reasonable for them to need to sleep or rest.
Bradley University’s policies for travel and/or expense reimbursements are subject to the accountable plan rules as set forth by the Internal Revenue Service. The requirements for an accountable plan are:
1. Expenses must be expenses that are incurred by the employee in connection with the performance of service for the employer.
2. Expenses must be substantiated to the employer within a reasonable time period. The elements to be substantiated are amount, time, place and purpose.
3. Employees must return to the payer within a reasonable period of time any amount paid under the arrangement in excess of the substantiated expenses.
If a plan fails to meet the requirements of an accountable plan, the amounts paid under the plan are treated as if paid under a non accountable plan and are treated as wages subject to employment taxes and income taxes.
Section A. In general, University employees are subject to the travel policies and procedures as outlined in the Faculty Handbook and the Administrative Handbook. Employees traveling on a regular, recurring basis must obtain a Bradley Travel card. This card must be used for all pre-approved university related business travel (and only for Bradley University business). For all other travel, the University will reimburse a traveler for items paid personally after travel has taken place. Requests for reimbursement must be made to the Controller’s Office within sixty (60) days after the last day of travel; requests submitted after the sixty (60) day period will not be honored. Reimbursement requests will need to be submitted prior to grant closing dates and the University’s year-end closing at May 31. Expenditure Reimbursements must be submitted within 60 days from the date of the incurred expense.
The Controller’s Office will honor only one reimbursement per trip. Original, itemized receipts of all expenditures must be attached to the request for reimbursement. The Travel Expense Form should be used. Reimbursement is for actual expenditures. Reimbursement requests submitted by the 1st of the month will be paid by the 15th of that month; requests submitted by the 15th of the month will be paid by the last day of the month. Checks will be sent by the Controller’s Office to the University employee through campus mail, unless pick-up is specified. If the reimbursement is for less than $200, with proper approval and substantiation as required below, cash may be given at the Cashier’s window in lieu of a check. Cash reimbursements will only be given to the individual requesting the reimbursement (i.e., student workers cannot be sent to pick up the reimbursement).
In certain situations, trips are funded through a combined use of the Bradley Travel card, reimbursement request and/or cash advance. When this occurs, all forms must be submitted for clearing at the same time to the Controller’s Office.
Section B. Receipts. Proper approval of any reimbursement request must be obtained from the immediate supervisor (e.g., director, department head, dean, provost, vice-president, president). This individual authorizing the requisition will be held accountable for any issues presented during audit.
The appropriate account number and sub-code are required on reimbursement requests submitted for approval. All expenses must be documented on one reimbursement request. If funding is from multiple accounts, all accounts must be listed on the reimbursement form. Do not send in multiple reimbursement requests.
Original, itemized receipts must be submitted with the request. To meet IRS accountable plan rules, the receipts must indicate:
- Location of travel
- Dates of travel
- Business purpose of travel
- Attendees, if applicable
- Indication that the bill has already been paid by the employee. For instance, for domestic travel, hotel bills must either show a zero balance due or the employee must also submit his credit card statement.
Specifically, when requesting reimbursement for conference registrations, a copy of the personal check used to register or charge card documentation along with a copy of the registration form/conference itinerary can be submitted in lieu of the actual receipt. Any meals purchased when otherwise provided by the conference will not be reimbursed. Reimbursement for airfare requires either an original itinerary with form of payment indicated or the actual ticket that shows amount paid and form of payment. Coach or tourist fare is reimbursed for air travel. Requests for hotel reimbursements must include the hotel portfolio. Room service and meal charges on the portfolio should be accompanied with an itemized meal receipt, where possible. Adequate substantiation is still required. Hotel reimbursement is only allowed for lodging when traveling on University business away from the University. Miscellaneous charges must be reasonable, itemized, and explained to justify business purpose. Receipts for ground transportation (e.g., taxis, buses) are required, if possible. Coach or tourist fare is reimbursed for rail or bus travel. Regardless, substantiation is still required (as indicated in 1 through 4 above).
Mileage is reimbursed at the allowable University rate (currently at 55.5 cents per mile) from the Bradley University base of employment to the travel destination.
The University allowable rate established each year cannot exceed the Internal Revenue Service Standard rate for the respective periods and may in fact be lower.
Section C. Meal reimbursements should be documented with original itemized receipts. Charge card receipts must include the original itemized receipt. Costs incurred for meals must be reasonable. Tips for meals in excess of 20% will not be reimbursed. Any meals purchased when otherwise provided by a conference will not be reimbursed.
If an itemized meal receipt is not submitted and this is an occasional, non-recurring occurrence, the traveler will be reimbursed according to the following schedule as long as business purpose, location, date and attendees are indicated:
Breakfast $ 6.00 including tips
Lunch $ 9.00 including tips
Dinner $20.00 including tips
Meal reimbursement from restricted funds under this method , if allowed by the sponsoring agency, must also contain the following statement that is acknowledged by the traveler: “Only allowable expenditures, as determined by the sponsoring agency and in accordance with the project budget, have been incurred and are being requested for reimbursement.”
Please note that meals while traveling overnight are subject to IRS travel rules. Meals while on University business but not away from “home” or while traveling are subject to the entertainment rules. Under the travel rules, meals are an allowable travel expense only if the trip takes substantially longer than an ordinary day’s work and one needs to get sleep or rest to meet the demands of the work while away from home. Thus, with one-day trips the lunch meal is generally considered a personal expenditure and is not reimbursable. But should travel exceed 10 hours, the dinner meal may be reimbursed. All meal expenditures may be reimbursed when travel is over-night provided they are properly approved with business use substantiation and they are not lavish or extravagant.
Under the entertainment rules, meals must meet the business requirement test to be reimbursable. Otherwise the meal is deemed a personal expenditure. To meet the business requirement test, the main purpose of the meal must be the active conduct of business for the general expectation of getting some specific business benefit at some future date. Meals with outside parties can generally meet this requirement. It is much harder to substantiate a meal between associates as there is generally no real business reason for conducting the discussion during the meal. Thus, meals provided at departmental meetings are not generally reimbursed.
Food and beverages for employees furnished on business premises may be reimbursed to the extent that it is reasonable and infrequent. Infrequent would constitute two or three times a year. Thus, the employee staff meeting, the appreciation dinner, the retreat, the company picnic or Christmas dinner would all be reimbursable as long as these were non-recurring activities.
- Proper approval on the statement.
- All original itemized receipts (see discussion on specific items in B and C above).
- Business purpose on all receipts (including when, where, why, who and what).
The documentation must be timely submitted to ensure payment by the due date. Finance charges are the financial responsibility of the cardholder. The cardholder is responsible for submitting and resolving all disputes with the credit card company. If the credit card receipt is lost or otherwise not submitted, the cardholder is responsible for the expenditure and should submit a personal check made payable to the University along with other documentation. If receipts are found at a later date, the cardholder may request reimbursement at that time.
Section E. Travel on Restricted Funds. University travel expense reimbursement policy and procedures apply to all travel on sponsored project funds unless the sponsored agreement provides a different method of reimbursement. The traveler must comply with the travel requirements of the sponsoring agency, including all applicable OMB Circulars and state requirements. The following restrictions apply to sponsored project travel:
1. Travel on sponsored project funds is restricted to individuals who are directly associated with the scope and purpose of the project.
2. Foreign travel costs are allowable only when specific funds for foreign travel are provided in the sponsored agreement. Such travel may also require specific sponsor approval.
3. Foreign travel funded by the U.S. government is booked on a U.S. flag carrier if available. Deviations or exceptions are specifically approved in advance by the sponsoring agency.
Section F. Foreign travel. Please see Bradley University Foreign Travel Policy.
- Business office expenses (fax, copy services, telegrams, etc.)
- Business phone calls
- Conference fees
- Currency conversion fees
- Fees for the purchase of traveler’s checks for foreign travel
- for refueling a rented car
- Ground transportation (train, taxi, bus, subway, etc.)
- Laundry and dry cleaning charges for trips exceeding ten consecutive calendar days
- Parking and tolls
- Reasonable personal phone calls that allow the traveler to stay in touch with family as pre-approved by immediate supervisor.
- Tips up to 20% of meal cost
- Visa fees for business travel
Alcoholic beverages for students
Movie rentals, theater tickets, newspapers, magazines, prescriptions, over-the-counter drugs, hotel mini-bar expenditures, snacks, non-meal related food and drink items, etc.
- Insurance on rental automobiles
- Trip/flight insurance
- Parking tickets and fines for traffic violations
- Personal expenses
- Personal portion of airfare while on university business
- Personal-use portion of a car rented for university business
- Repairs or towing of personal vehicles used for university business. These costs are included in the mileage reimbursement rate.
- Expenses incurred by spouses, partners and families or rate increases occasioned by presence of spouses, partners and families.
- Laundry service for trips of less than ten consecutive calendar days
- Personal aircraft usage
- Extra baggage charges for personal items, such as golf clubs, skis, etc.
- Childcare or pet care costs
- Loss or theft of cash advance money, airline tickets, traveler’s checks, etc.
- Locksmith charges
- Lost baggage, luggage, and briefcases
- Souvenirs and personal gifts
- Health club fees
- Commuting expenses between home and work