Are you compensating employees for expenses related to home offices?

State Laws in MA, CA, IL, MT, IA and DC require employers to reimburse employees for all necessary business-related expenses while companies in other states often choose to offset their employee’s work-related home expenses.  

Asking employees to submit monthly receipts is time consuming and annoying, but compensation without substantiation is risky and costly.  In fact, for every $100 paid to employees through a taxable stipend, $37.65 is generally lost to taxes because the IRS regards most stipends as taxable income.  

Individualized stipends that factor in geographically specific cost of living data for home office related expenses like phone, internet and office space provide the substantiation like a line itemed receipt. Therefore the expenses are a reimbursement vs. compensation and can be reimbursed through payroll tax-free, saving both the employer and employee from incurring taxes.

Companies using this service see an average 24% reduction in their mobile and home office spend.

Contact us to learn more.