Instructions For Form 2106 - Employee Business Expenses

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time, place, and business purpose of

Accounted to your employer for the

Step 3—Figure Expenses

your travel.

expenses and

To Deduct on Schedule A

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Were required to return, and did

The standard meal allowance is

(Form 1040)

return, any payment not spent (or

the Federal M&IE rate. For most

considered not spent) for business

Line 9. Generally, you may deduct

small localities in the United States,

expenses.

only 50% of your business meal and

this rate is $30 a day for the period

entertainment expenses, including

from January 1 through September

If these payments were included in

meals incurred while away from home

30, 2003, and $31 a day for the

box 1, ask your employer for a

on business. If you were an employee

period from October 1 through

corrected Form W-2.

subject to the Department of Trans-

December 31, 2003. Most major

Accounting to your employer

portation (DOT) hours of service

cities and many other localities in the

means that you gave your employer

limits, that percentage is increased to

United States are designated as

documentary evidence and an

65% for business meals consumed

high-cost areas and qualify for higher

account book, diary, or similar

during, or incident to, any period of

rates. You can find these rates on the

statement to verify the amount, time,

duty for which those limits are in

Internet at

place, and business purpose of each

effect.

perdiem. Click on “2003 Domestic

expense. You are also treated as

Per Diem Rates” for the period

Employees subject to the DOT

having accounted for your expenses

January 1, 2003 – September 30,

hours of service limits include certain

if either of the following applies:

2003, and on “2004 Domestic Per

air transportation employees, such as

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Your employer gave you a fixed

Diem Rates” for the period October 1,

pilots, crew, dispatchers, mechanics,

travel allowance that is similar in form

2003 – December 31, 2003.

and control tower operators;

to the per diem allowance specified

However, you may apply the rates in

interstate truck operators and

by the Federal Government and you

effect before October 1, 2003, for

interstate bus drivers; certain railroad

verified the time, place, and business

expenses of all travel within the

employees, such as engineers,

purpose of each expense.

United States for 2003 instead of the

conductors, train crews, dispatchers,

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updated rates. You must consistently

Your employer reimbursed you for

and control operations personnel; and

use either the rates for the first 9

vehicle expenses at the standard

certain merchant mariners.

months of 2003 or the updated rates

mileage rate or according to a flat

Line 10 — Special rules. If you were

for the period of October 1, 2003,

rate or stated schedule, and you

a fee-basis state or local

through December 31, 2003.

verified the date of each trip, mileage,

government official (defined below),

and business purpose of the vehicle

For locations outside the

include the expenses you incurred for

use.

continental United States, the

services performed in that job in the

See Pub. 463 for more details.

applicable rates are published

total on Form 1040, line 33. Write

monthly. You can find these rates on

“FBO” and the amount in the space to

Allocating your reimbursement.

the Internet at

the left of line 33 on Form 1040. Your

If your employer paid you a single

als/prdm/2003.

employee business expenses are

amount that covers meals and

See Pub. 463 for details on how to

deductible whether or not you itemize

entertainment as well as other

figure your deduction using the

deductions. A fee-basis state or local

business expenses, you must

standard meal allowance, including

government official is an official who

allocate the reimbursement so that

special rules for partial days of travel,

is an employee of a state or political

you know how much to enter in

transportation workers, and taxpayers

subdivision of a state and is

Column A and Column B of line 7.

related to their employer.

compensated, in whole or in part, on

Use the following worksheet to figure

a fee basis.

this allocation.

Step 2—Enter

If you were a qualified

Reimbursements Received

Worksheet (keep for your records)

performing artist (defined below),

From Your Employer for

include the part of the line 10 amount

1. Enter the total amount of

Expenses Listed in Step 1

attributable to performing-arts-related

reimbursements your employer

expenses in the total on Form 1040,

Line 7. Enter reimbursements

gave you that were not

line 33. Write “QPA” and the amount

received from your employer (or third

reported to you in box 1 of

in the space to the left of line 33 on

party) for expenses shown in Step 1

Form W-2 . . . . . . . . . . . . . . .

Form 1040. Your performing-arts-

that were not reported to you in box 1

2. Enter the total amount of your

related business expenses are

of your Form W-2. This includes

expenses for the periods

deductible whether or not you itemize

reimbursements reported under code

covered by this reimbursement

deductions.

“L” in box 12 of Form W-2. Amounts

3. Of the amount on line 2, enter

reported under code “L” are certain

A qualified performing artist is an

your total expense for meals

reimbursements you received for

and entertainment . . . . . . . . .

individual who:

business expenses that were not

4. Divide line 3 by line 2. Enter

1. Performed services in the

included as wages on Form W-2

the result as a decimal

performing arts as an employee for at

(rounded to at least three

because the expenses were treated

least two employers during the tax

places) . . . . . . . . . . . . . . . . .

as meeting specific IRS

year,

5. Multiply line 1 by line 4. Enter

substantiation requirements.

2. Received from at least two of

the result here and in Column

Generally, when your employer

those employers wages of $200 or

B, line 7 . . . . . . . . . . . . . . . . .

pays for your expenses, the

more per employer,

6. Subtract line 5 from line 1.

payments should not be included in

3. Had allowable business

Enter the result here and in

box 1 of your Form W-2 if, within a

expenses attributable to the

Column A, line 7 . . . . . . . . . .

reasonable period of time, you:

performing arts of more than 10% of

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Instructions For Form 2106 - Employee Business Expenses - 2003 Page 3

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