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Hello everyone, For all travel beginning July 1st 2008 through December 31st 2008, the IRS standard mileage rate for the use of a personal vehicle driven for business purposes has increased to 58.5 cents per mile for business miles driven. The IRS standard mileage rate for relocation has increased to 27 cents per mile driven. The latest version of the travel and business expense report reflects this change, and is available on our website: http://finance.columbia.edu/procurement/ap/worksheets.html
Thank you, The AP Team Greetings everyone, For all travel beginning January 1st 2008, the IRS standard mileage rate for the use of a personal vehicle driven for business purposes will be 50.5 cents per mile for business miles driven. The IRS standard mileage rate for relocation is 19 cents per mile driven. The latest version of the travel and business expense report reflects this change, and is available on our website: http:www.finance.columbia.edu/procurement/ap/resources/TBExpReportWorkbook.xls Thank you, The AP Team Business purpose must be specific and detailed, to allow any person reviewing the expense report to understand why the expense is appropriate towards furthering the University’s mission and therefore, why the University is responsible for paying this expense. The business purpose is obvious to the employee and, typically, the department, but it must be documented so an unrelated third party (such as an auditor or the IRS) can review the report and make the connection. As examples: “Medical Conference” should be documented as “Presenting study findings at AMA Conference for Pediatric Surgeons in Orlando, FL” “Business lunch” should be documented as “Lunch with J. Smith (CU donor) to discuss the Smith Scholarship Fund recipients” “Department breakfast” should be documented as “Breakfast for AP department for quarterly recognition awards” We appreciate your cooperation with this very important compliance matter. Subject:Taxable Payments not paid directly by AP The Accounts Payable Department has, in recent months, received a number of Travel & Business Expense reports requesting reimbursement to a University employee for service payments or honoraria that the employee has paid to others up front with personal funds. These payments for services and honoraria are taxable income to the original recipient and reportable to the IRS. In order to ensure compliance with IRS reporting requirements, AP policies require these payments be made directly by the University to the recipient through submission of an invoice or a check request for payment. In addition, payments of these types may also involve other IRS requirements, such as certain withholding requirements, that can also only be identified and complied with through direct payment by the University. To ensure compliance with these important IRS and State regulations and prevent the liabilities that occur from noncompliance, the University must strictly enforce the AP policy and cannot reimburse employees for payment for services and honoraria made with personal funds. Please note, this policy is not applicable to payments to a foreign person for work performed in a non-US location. While payment by invoice and/or check request is preferred, local circumstances may require a documented cash payment. Please ensure all faculty and staff understand that these payments must be paid by invoice or check request through Accounts Payable and not through out-of-pocket personal funds. AP can accommodate urgent payments due to unavoidable circumstances through the rush request process (http://finance.columbia.edu/forms/form_rush.html). We appreciate your cooperation with this very important compliance matter.
August 31, 2007
Accounts Payable is responsible for ensuring that the University is in compliance with the IRS regulations regarding the reporting of taxable payments. For US persons or entities, this is accomplished by reporting calendar year income on a Form 1099. A vendor set up as a “1099 reportable” vendor in AP/CAR will be flagged for reporting on a 1099. Vendors that are set up as a “1099 reportable” vendor may also receive payments that are not considered taxable, or reportable as income on a Form 1099. The most common scenario is an individual who has been invited to campus and receives an honorarium, but also receives a reimbursement for their travel. In this situation, the honorarium is a taxable payment, but the expense reimbursement is not. How do I enter an honorarium and travel expense properly in AP/CAR? For this example, let’s say the speaker received an honorarium payment of $1,000 and her travel expenses are $500, for a total payment to the speaker of $1,500. When entering the voucher in AP/CAR, enter the gross amount of the payment as $1,500. Then in AP/CAR, look for the box located below the gross amount box titled “Non-1099”. In that box, enter $500 (the amount of the travel expense reimbursement). Now when the 1099 reportable amount is calculated, only $1,000 will be reported, instead of the entire $1,500. If the 1099 option is not available, please email vendormaintenance@columbia.edu for additional instructions. If the speaker received an honorarium during a prior visit, but only an expense reimbursement during the most recent trip, please do not request that AP change the vendor profile. If you are reimbursing $700 of travel expenses, enter $700 in AP/CAR as the gross amount of the payment and then enter $700 into the “Non-1099” box.
Many of the 1099 corrections that Accounts Payable processes each year are due to expense reimbursements being entered into AP/CAR incorrectly. This often results in income appearing on that individual’s 1099 when it should not. By correctly entering this information in AP/CAR, you can ensure that your visitor receives an accurate 1099, and the University complies with the IRS regulations. If you have any questions please contact the AP Service Center at 212-854-2122 or email apservice@columbia.edu.
In accordance with the Travel and Business Expense policies and Supplemental Approval policy, expenses must be submitted to the department within 120 days of the expense/trip return or the end of the fiscal year, whichever is sooner. Supplemental Approval is required when this is not met: Expense reimbursements submitted beyond 120 days and/or FY 07 expense reimbursements not submitted before the end of the fiscal year require supplemental approval. All FY 07 expense reimbursements not submitted before the end of the fiscal year are NOT taxable, unless they also exceed the 120 days. We recognize that an employee incurring an expense late in June will need time to submit the expenses and the department will need time to review and process these. Therefore for all expenses incurred between June 15 and June 30, 2007, we will allow these to be submitted for reimbursement without supplemental approval, if not submitted before the close. Please note, these expenses will not appear in your FAS accounts for the year ended June 30th, 2007.
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