If our business pays for an employees airfare on a business trip, but the employee does not submit an expense form relating to the travel, do we need to issue a Form 1099-MISC?
No, you should report the amounts as wages on Form W-2. Generally, Form 1099-MISC is not issued to employees. Payments to your employee for travel and other necessary expenses of your business under a nonaccountable plan are wages and subject to income tax withholding and payment of social security, Medicare, and FUTA taxes. Your payments are treated as paid under a nonaccountable plan if: • Your employee is not required to or does not substantiate timely those expenses to you with receipts or other documentation, or • You advance an amount to your employee for business expenses and your employee is not required to or does not return timely any amount he or she does not use for business expenses. The amount of the airfare should be included on the employee’s Form W-2.
No, you should report the amounts as wages on Form W-2. Payments to your employee for travel and other necessary expenses of your business under a nonaccountable plan are wages and subject to income tax withholding and payment of social security, Medicare, and FUTA taxes. Your payments are treated as paid under a nonaccountable plan if: • Your employee is not required to or does not substantiate timely those expenses to you with receipts or other documentation, or • You advance an amount to your employee for business expenses and your employee is not required to or does not return timely any amount he or she does not use for business expenses. The amount of the airfare should be included on the employee’s Form W-2.
Related Questions
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