FIN 420–01: Faculty and Staff Reimbursements: Accountable Plan Rules
To permit reimbursements to faculty and staff for authorized expenditures under the IRS Accountable Plan rules
IRS Publication 463: Travel, Entertainment, Gift, and Car Expenses
All university faculty and staff
“Non-employees,” (e.g., independent contractors) on university business
For ASU to reimburse faculty and staff for authorized business expenses incurred on behalf of ASU the reimbursement must meet the requirements outlined in the IRS Accountable Plan rules.
ASUís reimbursement policy incorporates all of the required IRS Accountable Plan rules, as follows:
When these three rules for Accountable Plans are met, reimbursements are not included in the taxable compensation for faculty or staff. However, if the above requirements are not met, the amount that is paid to the employee is treated as paid under a Nonaccountable Plan and is taxable as compensation, subject to income and payroll taxes, as applicable.
If a non-employee does not properly account to the university for reimbursed expenses, the reimbursement will be reported as compensation to the non-employee.
Proper substantiation must be made for reimbursements. Elements of proper substantiation include records to establish the following:
When receipts are required for faculty/staff reimbursement of university expenses (that serve a legitimate business need for ASU), the original receipts must be provided.
The university will reimburse approved travel expenses. Refer to FIN 500 for guidance on travel.
Faculty and staff may obtain travel advances (short-term cash advances) from the university (see FIN 501, “ASU Travel Policy”).
All travel expense reimbursements are claimed on a Travel Claim form; however, reimbursements for mileage may be claimed by completion of a payment voucher (PV). Reimbursements for parking may be may be claimed through petty cash or by completion of a payment voucher (PV).
Subsequent to the initial reimbursement to claimed expenses, an audit or other review may identify an error that resulted in an over- or underpayment to the employee. In these cases, a repayment to the university by the employee, or an additional payment to the employee by the university, may be made.
Faculty and staff may be reimbursed for business meals, food, and related expenses (see FIN 420–02, “Business Meals, Food, and Related Expenses”).
New faculty and staff may be reimbursed for moving expenses for moving their household goods and personal effects and for traveling to their new home (see FIN 420–03, “Moving Expenses”).
Faculty and staff may procure goods or services that cost less than $1,000 directly from a vendor and request reimbursement if adequate documentation of the purchase is provided, i.e., the original vendor receipt. Reimbursements for an amount greater than $1,000 require dean or director approval, the respective provost, vice provost, or vice president approval, and Purchasing and Business Services approval. Purchases prohibited in FIN 401–03, “Prohibited Transactions,” cannot be processed as an employee’s reimbursement. Purchases identified in PUR 401, “Special Goods,” and PUR 402, “Special Services,” require special handling procedures prior to a purchase. Additionally, payments that constitute compensation for services rendered should not be paid for by faculty or staff directly. Compensation includes, but may not be limited to, payments for services performed by employees or independent contractors/consultants, payments for student support, and payment of expenses incurred by an employee or independent contractor/consultant. Reimbursements for purchases of prepaid calling cards require special attention as detailed in FIN 420–07, “Prepaid Calling Cards.”
Faculty and staff who receive reimbursement from a third party for any expenses paid or reimbursed by ASU must return those funds to ASU. The returned funds shall be deposited to the agency/org and object/sub object code where the payment or reimbursement was processed.
The Purchasing Card is the preferred method of making small-dollar purchases for those departments authorized to use the Purchasing Card. Departments are responsible for reconciling credit card statements and retaining documentation in accordance with the policy pertaining to the purchasing card, per PUR 304-04.
Faculty and staff are eligible for an ASU-sponsored Diners Club university travel card, which may be used for university travel expenses. Cardholders pay Diners Club directly for their purchases, then request reimbursement from ASU. ASU does not pay Diners Club directly.
Purchasing items from a warehouse club can be cost effective for departments purchasing items in large quantities. In the event that a department deems it in the best interest of the university to purchase a business membership to a warehouse club, the department should only join at the regular business level and not the higher “executive level.” All cards related to the membership must be held by ASU employees and used only to purchase supplies for ASU.
Purchases of warehouse club memberships require vice provost/vice president approval.
For additional approval information, see FIN 401–02, “Provost/Vice Provost/Vice President Approvals.”
For more information on approvals, see FIN 401–02, “Provost/Vice Provost/Vice President Approvals.”
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