Having started in the Healthcare Travel Industry, we are keenly aware of the needs of "contingent" professionals and their employers. Whether you are in the healthcare, nuclear, engineering, information technology or other contingent industry, our specialized services can help you with:
Please contact us for further information of how we can serve your company.
Recruiters are one of your most important assets. If a traveler finds a recruiter they trust, they will be loyal to that recruiter, even follow them if they change companies. Facilitating that relationship not only provides a source of new travelers, it reduces the “soft costs” associated with a processing a new employee.
A knowledgeable recruiter is indispensible. One of the many items that a recruiter has to explain is the nuances of your reimbursement policy. Travelers are understandably confused over their travel, lodging and meal per diems/allowances, how these fit in to their paycheck and how they qualify. Many do not even know where to start to look for information in these areas and often in the rush of signing contracts, they will ask their recruiters for advice on how to fill out their tax home statements, W4, and other forms. While it is always best to direct them to a tax professional, there is basic information that a proficient recruiter can pass on to their travelers. Our in-services help to ensure that what is said (and what is not said) is correct, reduces your risk should a complaint be filed and possibly more importantly, we try to dispense with the myriad of myths and rumors propagated by your competition. As one of the primary contributors/editors to NATHO’s tax best practices paper, our presentation will help you stay current with industry practices. After the training, we continue to be a resource for your staff, answering any questions that arise and heartily welcome any travelers you refer to us for assistance with their tax filings or even the random question.
Recruiter In-Services are available in multiple forms: Live (where we come to you) or Teleconference. Please contact us for more information.
We are fanatical about accuracy. Joe has years of focused research, creating a knowledge base that is extensive. He will often utilize multiple court opinions to evaluate each situation for education or policy suggestions.
Joe does not "read articles" about these issues, he is the one that writes them. If you question anything on our website, or want supporting documents, we can provide them.
According to IRS pub 463 a job is far enough away if "you need to sleep or rest to meet the demands of your work while away from home." If that rest takes place at or near the traveler's tax home, it does not qualify, regardless of distance.
Many companies will use a policy of a 50 mile radius; however it should never go further than an internal screen. There is no such thing as a 50 mile rule in the tax code that allows one to qualify for tax free housing allowances. Only elected state legislators have that provision. While the desire for a mileage threshold is understandable, the more important question is: where is the traveler spending the night? While a company cannot be expected to police their employees, there must be a reasonable expectation that the traveler is getting their sleep "away from home" Depending on what part of the country you are in, 50 miles can be covered in a 40 minute commute. Tax free housing allowances must accompany housing expenses at the assignment. A 50 mile rule does not ensure that.
We wish we could give a succinct answer here. Then we would print it on gold paper, seal in platinum, sell one to each staffing company, and retire on the proceeds.
To help avoid the liability of wage recharacterization, a staffing agency needs to have a written policy that lays out the administration of their reimbursement program. This is an area that one method may sound quite reasonable, yet be grievously in error. All we can do here it to offer to talk it over with you. Please give us a call.
The practice of willfully reducing wages (taxable income) and replacing it with non-taxable compensation with the intent of avoiding payroll taxes.
This can be suspected in a number of ways. Below are just a few examples:
1) A company having a number of travelers working at the same location, one gets $30/hr wages plus $7/hr reimbursements and another gets $20/hr plus $17/hr in reimbursements. (Note both are getting the equivalent of $37/hr.)
2) Present contracts that offer the choice of picking between a taxed wage and the option of a reduced rate with tax free reimbursement payments in its place.
While ultimately the taxpayer is responsible for representing themselves accurately and paying the correct amount of income tax, there is a minimum due diligence that the employer is responsible for in screening the existence of a tax home with their employees. In all honesty, this is not much different from requesting copies of an employee's professional license and work history.
Tax home statements can be very detailed, showing that a reasonable attempt was made to evaluate the employee's status before giving thousands of dollars in tax free reimbursements; or they can be so basic that they require nothing more than a signature after a one sentence statement. The latter example could be deemed as self-serving, encouraging the employee to sign off on it without serious consideration. Our extensive experience has shown us that In the case of a company audit, the IRS is often interested in the appearance of intent.
Feel free to contact us to have your tax home statement evaluated.
We are always happy to give someone 15 min of our day. Do not hesitate to call us with a question. A considerable portion of our business is education and we realize that sometimes we all need a little advice.
Should you find that you need substantial advice or an ongoing relationship, we can set up a consultation agreement for further discussions.
We think it is. Having been involved with it since its inception, we are pleased with what it has accomplished.
NATHO offers balance, cooperation and information sharing that is rare for this industry. It is non-profit and managed by an independent third party, so personal company data is redacted and with statistics shared, everyone benefits from the ability to have industry benchmarking.
It is amazing how many fine details as involved when you start a business! You think it will be just a matter of keeping records of income and expenditures, then you find out you are responsible for following hundreds of regulations you never knew existed. When you go to read these regulations, you don’t even understand the terms they use to define the regulations. A double disadvantage.
Yes, we can help. Since so much of our tax business involves education. We can start at the beginning and explain the tax issues step by step. Give us a call, meanwhile you can go over to the www.traveltax.com site under “learn about taxes” and start to read.
Per diems are a “both or nothing” kind of thing. When a company pays a per diem for housing and even states that it is for housing and not meals, as far as the IRS is concerned, that payment is 60% for housing and 40% for meals. Also when a company pays less than the total amount of the combined per diem (housing & meals), the same occurs. The official regulations can be read at: IRS Rev Proc 2011-47, section 6.05.
As always, there are exceptions: When a company directly pays for housing or reimburses an employee for exact cost of housing (per physical receipts), then a meal allowance is optional, up to the prevailing rate.
On the company side that means if you only provide a housing stipend or allowance, but no meals, you must split that amount 60-40. And the 40% portion allocated to meals falls under the 50% meal allowance limitation. Ultimately, your company loses a portion of the total stipend to meal deduction limitations. Only when you directly bill the client for the meals can you claim a 100% deduction for meals.
For the traveler’s tax return, the unspecified stipend (or housing only stipend) must be split and 40% of it gets credited against the total cost of meals the traveler claims. The flip side is also true, if only 60% of the stipend applies to housing, any additional expenses over that amount are now deductible, but accurate receipts and records need to be kept.