XIII. Employee Expense Reimbursement

Guide to Financial Operations

XIII.12 Procedure for Reporting Taxable Employee Expense Reimbursements for Prior Open Tax Years

XIII. Employee Expense Reimbursement
Guide to Financial Operations


This section discusses how to process adjustments to an employee’s taxable income for prior tax years in order to comply with Internal Revenue Service (IRS) reporting requirements.

On occasion, Business Units may need to make adjustments to an employee’s taxable wages for prior tax years. This may occur if a Business Unit did not process an expense report with the correct expense type or taxable value, resulting in an inaccurate calculation or reporting for the tax year of payment.

Process and Document Preparation

When a Business Unit becomes aware that an employee’s taxable income was misreported for prior tax years, the Business Unit should email the Office of the State Comptroller’s (OSC) Tax and Compliance Mailbox at [email protected]. The subject should indicate that the email is regarding an adjustment to a prior tax year. Additionally, the body of the email should include at a minimum:

  • The tax year for which the adjustment is applicable
  • The adjustment amount
  • The employee’s name
  • The employee’s identification number
  • The reason for the adjustment

Business Units should retain information to support the adjustment amount and make it available to OSC upon request. Additional information on taxable employee expenses can be found in the following sections of this Chapter:

Guide to Financial Operations

REV. 12/02/2014