Example of an Accountable Plan for S-Corp or LLC

Accountable Plan for [Company Name]

Effective Date: [Date]

Section 1: Purpose This accountable plan establishes procedures for reimbursing employees for business-related expenses in compliance with IRS regulations. The purpose is to ensure that all reimbursements follow IRS guidelines and are not treated as taxable income to employees.

Section 2: Covered Expenses 2.1 Mileage and Travel Expenses - Employees will be reimbursed for business-related mileage based on the IRS standard mileage rate. 2.2 Home Office Expenses - Reimbursement is allowed for employees using a dedicated home office for business purposes. 2.3 Meals and Entertainment - Only business-related meals and entertainment expenses incurred while conducting company business are reimbursable. 2.4 Office Supplies and Equipment - Employees can receive reimbursement for necessary business-related supplies, such as stationery, printers, and other essential materials.

Section 3: Reimbursement Process 3.1 Expense Report Submission - Employees must submit an expense report within [number] days of incurring an expense. 3.2 Required Documentation - All submissions must include receipts, mileage logs, or any supporting documentation. 3.3 Approval Process - Expense reports must be approved by [Manager/Officer Name] before reimbursement is processed. 3.4 Reimbursement Timeline - Approved reimbursements will be processed within [number] business days.

Section 4: Compliance 4.1 IRS Compliance - Reimbursements must meet IRS requirements under IRC Section 62(a)(2)(A) to be excluded from taxable wages. 4.2 Return of Excess Payments - Any excess advances or unsubstantiated reimbursements must be returned within [number] days to avoid taxation. 4.3 Record Keeping - The company will maintain documentation of all reimbursed expenses for at least [number] years.

Section 5: Amendments 5.1 This accountable plan may be amended by [Company Name] at any time, provided changes comply with IRS regulations.

Signatures: Authorized Officer: ____________Title: ____________Date: ____________