Many employees have business expenses, but have questions about what's allowable and what type of documentation is needed. To help with that, DOR has created a short video and an Employee Business Expenses page that lists the top reasons contributing to the disallowance of an employee business expense, along with our Audit Division’s recommendations for how to avoid possible errors. Take a look before you, or your practitioner file.
Here's a few samples from the page:
1) Lack of documentation to support an expense
- Business purpose of expense
- Ballpark estimates
Solution: Retain all business related receipts. Ideally, the receipts should be retained in chronological order. Maintain a calendar to record business purpose/contact/time/location of the business meeting.
2) Incomplete or insufficient travel log.
Solution: Maintain a real time daily travel log that includes necessary information including, address of location, mileage and business purpose/contact of the trip.
3) Failure to respond to a DOR Notice.
Solution: Respond to the notice if you believe you are entitled to the deduction.