Is It Time To Get Accountable With
Your Employees' Expenses?
companies start out, and get pretty far down the road, using
the "per diem" approach when reimbursing employees for
lodging, meals and incidental expenses.
Doing so involves the
use of either IRS tables or a simplified high-low method to
reimburse workers up to specified limits.
The per diem approach is relatively simple and doesn't involve
too much record keeping. But it also puts businesses at risk
if they exceed the per diem limits, exposing them to IRS
penalties and employees to higher tax liability. For this
reason, companies often reach a point where they create an
"accountable plan" for handling employee expense
the tax advantages
An accountable plan is a formal arrangement to advance,
reimburse or provide allowances for business expenses. The
primary advantage is that your business can deduct expenses
(subject to a 50% limit for meals and entertainment), and
employees can usually exclude 100% of advances or
reimbursements from their incomes. Workers whose jobs involve
frequent travel may realize significant tax savings.
To qualify as "accountable" under IRS rules, your plan must
meet the following criteria:
- It must pay expenses that would otherwise be deductible by
- Payments must be for "ordinary and necessary" business
expenses such as airfare and lodging charges.
- Employees must substantiate these expenses - including
amounts, times and places - ideally at least monthly.
- Employees must return any advances or allowances they can't
substantiate within a reasonable time, typically 120 days.
If you fail to meet these conditions, the IRS will treat your
plan as nonaccountable, transforming all reimbursements into
wages taxable to the employee, subject to income and
employment taxes - though potentially deductible by the
Accountable plans take time to establish and require
meticulous record keeping. Let us help. We'd be happy to
assist you in setting up your accountable plan and regularly
reviewing its compliance with IRS rules. Call us at
SMEED CPA Adds Financial
Services To Help Clients With
Investments & Insurance
often we here at SMEED CPA are asked about financial issues
that impact our clients investments and their portfolios.
We always offered our opinion and suggestions but in order to
help our clients actually execute the changes we suggest,
SMEED has created a Financial Services division.
SMEED Financial Services, Inc. will be able to
work with both individual and business clients on their
investment portfolios and manage assets on their behalf.
SMEED Financial will include Michael Uadiale,
ACA, CPA, CGMA; and Pablo Blanco who has
recently joined SMEED and comes with over 18 years of
financial sales and advising experience with affluent
Watch your inbox and mail boxes for more specific information
on services SMEED Financial Services, Inc will make available
Would You Give Me Your
Feedback & Testimonial
on Our Hotline?
Hello it’s Michael Uadiale, CPA of
SMEED CPA Inc. We’ve just installed a toll-free
number that I would like for you to call and tell me how you
think we are doing as your CPA firm.
Just dial 800-609-9006
extension 3638 and follow the instructions. If we’ve
done a good job please let me know. And if we can
improve on anything, please mention that too.
Us Be Found on
Also as we expand our business,
we find more and more people are using
YELP and Google
to look for us by searching Brentwood accountant or
When they do this we want to
be FOUND on GOOGLE. One way you can help us
is to give us an
ONLINE REVIEW on our Google Maps/Places listing --->
or on our YELP local listing
click here to go to our Google Listing for SMEED CPA and
click on the
YELP link to go there.
Scroll down to the Review area.
On either site it may say: Been here?
Rate and review
You will click on the Rate and
review link and then log in, then
give us a review!
You can choose between 1 and 5
STARS and write in what you think about the tax or accounting
work we have done for you.
It's that simple. Thank
you in advance for your help and cooperation!
As always you can call our offices if you have any
questions about these or any other accounting related issues, at
Regards, Michael Uadiale, CPA,
Managing Partner, SMEED CPA,