ACCOUNTABLE REIMBURSEMENT PLAN OF [COMPANY]

It is the policy of [COMPANY] (hereinafter referred to as the “Company”) to reimburse employees, partners, members, and/or independent contractors (hereinafter collectively referred to as “Associates”) for authorized business expenses of the Company pursuant to the following guidelines.

Expenses must have a business connection: Authorized expenses paid by any Associate of the Company must have a business connection and must otherwise be deductible by the Company under federal tax law. (Treas. Regs. §1.62-2(d)) In order to be deductible under federal law, the expenses must be incurred in connection with the performance of services by the Associate on behalf of the Company.

Expenses must be substantiated: Associates must substantiate their business expenses to the Company for reimbursement. (Treas. Regs. §1.62-2(e)) Substantiation includes any relevant documentary evidence that shows the following with respect to every expense for which the Associate seeks reimbursement:

• Amount;
• Date;
• Location;
• Description of the business purposes of the expense; and
• Any other relevant information regarding the expense.

Documentary evidence must be in the form of receipts, invoices, bills of sale, or any similar documentation. Credit card bills and bank statements alone are insufficient documentary evidence.

Mileage reimbursement for personal vehicles: Associates shall be reimbursed for the preapproved business use of their personal automobiles at the standard federal mileage rate for the period of business use.

Documentary evidence for mileage reimbursements must include a description of the business purpose, the starting location, ending location, and total miles. Printed driving directions from reputable internet map sources are acceptable to prove mileage.

Per diem reimbursement in lieu of strict substantiation: The Company, at its sole discretion, may reimburse Associates based on per diem amounts that do not require strict substantiation or documentary evidence of expenses. If the Company so elects, Associates must demonstrate the time, place, and business purpose of their trip. The per diem reimbursement shall cover the costs of lodging, meals, and incidentals but cannot exceed federal per diem rates.

Expenses that are not reimbursed: The following expenses are specifically not reimbursed under this plan:

• [List any expenses the Company specifically wishes to exclude from reimbursement, such as personal entertainment while traveling for work, meals in excess of a specified dollar limit, alcohol, home office, etc.]

Excess reimbursements must be returned: Associates must return to the Company, within sixty (60) days, any amounts provided as a reimbursement under this plan in excess of the Associate’s substantiated expenses. (Treas. Regs. §1.62-2(f))

Time for submitted reimbursement requests: Requests for reimbursement of business expenses under this plan must be submitted to the Company’s designated department in the manner required by such department (i.e., submitting documentary evidence together with a summary or tracking sheet) within sixty (60) days of the date of the expense).

Payment of reimbursed expenses: Reimbursements shall be paid to Associates in the same manner as the Associate receives his or her regular payment for services (i.e., employees shall receive reimbursement through a regular payroll check or a separate payroll check, independent contractors, partners, and members shall receive a nonpayroll check).

Plan year: This plan shall be maintained on a calendar-year basis.

Plan amendments and alterations: This plan shall not be amended or altered in any way by the Associate or the Company during the plan year. Once the method of reimbursement is established during the plan year, it must be used throughout the remainder of the plan year.

Associate’s failure to comply with plan: At the discretion of the Company, an Associate’s failure to comply with the requirements of this plan will render his or her expenses related to such failure nonreimbursable.

This accountable plan is hereby adopted by [COMPANY].

By: [NAME]
Its: [TITLE]