​

Overtime

   

Tips or other gratuities received by employees 

   

Payments by an employer to group insurance or group pension plans for employees, other than those covered by Rule 2-B-1-f and Rule 2-B-1-m

   

Payments by an employer into third-party trusts for the Davis-Bacon Act or a similar prevailing wage law provided the pension trust is qualified under IRC Sections 401(a) and 501(a)

   

The value of special rewards for individual invention or discovery

   

Dismissal or severance payments except for time worked or vacation accrued

   

Payments for active military duty

   

Employee discounts on goods purchased from the employee's employer

   

Expense reimbursements to the employees if the employer’s records confirm that the expense was incurred as a valid business expense.

Reimbursed expenses and flat expense allowances paid to employees may be excluded from the audit only if all three of the following conditions are met:

1. The expenses or allowances are incurred for the business of the employer

2. The amount of each employee’s expense or allowance is shown separately in the records of the employer

3. The amount of the expense or allowance approximates the actual expense incurred by the employee in the conduct of their work.

Note: If an employer did not maintain verifiable receipts for incurred expenses for an employee that was away from home overnight on the business of an employer a maximum expense allowance is permitted to be excluded. Refer to Rule 2-B-1-p Exception for the maximum employee expense allowance. (Maximum of $75/day)

Allowable travel expenses permitted by any contract with a federal, state, or local government entity, including, but not limited to, a city, borough, or village, are excluded from payroll. In lieu of verifiable receipts for incurred expenses, the employer must produce a copy of the contract provision permitting the travel expenses at audit. The allowable travel expenses must be in addition to the current wage of the employee.

   

Meal money for late work

   

Work uniform allowances

   

Sick pay paid to an employee by a third party such as an insured's group insurance carrier that is paying disability income benefits to a disabled employee

   

Employer-provided perks such as:

• Use of company-provided automobiles 

• Airplane flights

• Incentive vacations (e.g., contest winners)

• Discounts on property or services

• Club memberships

• Tickets to entertainment events

• Educational assistance

• Relocation and moving expenses

 

   

Employer contributions to employee benefit plans such as:

• Employee savings plans 

• Retirement plans

• Cafeteria plans (IRC 125)

• Health savings accounts

• Flexible spending accounts

These include contributions made by the employer, at the employer’s expense, which are determined by the amount contributed by the employee