Reimbursement Policy and Procedures for University-Related Business Expenses

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Purpose:

Texas Christian University reimburses faculty and staff for properly authorized, necessary and reasonable expenses incurred in the conduct of University business or authorized in a budgeted grant or contract.  The intent of this policy is to ensure the reimbursement is fair and equitable to both the individual and the University.

 I.    Reimbursement Policy

It is the responsibility of faculty and staff to comply with the University’s reimbursement policy.  Personal payments generally should not be made for non-travel business expenses that can be paid directly by the University.  Payment for all goods costing more than $500 must be made directly by the University unless an exception for using personal funds exceeding $500 is pre-authorized and documented on the on-line Authorization Form for Personal Payment of Non-Travel Business Purchases.  The approved form must be submitted with the employee’s TCU Reimbursement Form.  In addition, employees should not pay other individuals or vendors for services performed on behalf of the University.  Payments for services must be made directly by the TCU Accounts Payable Department in the Financial Services Office.

Faculty and Staff traveling on business are responsible for complying with the University’s reimbursement policy and should exercise the same care in incurring expenses as they would in personal travel.  This policy applies to all expenses fully or partially reimbursed by the University regardless of the source of funds.  When expenditures are to be charged to a sponsored project, the terms of the applicable award will take precedence if they are more restrictive than University policy.

While these guidelines are intended to be comprehensive, it is impossible to anticipate every situation that may be encountered.  Thus, the individual is expected to apply these policies on a conservative basis, consistent with normal living standards, and where the policy is silent, to exercise good business judgment.

All expenses incurred in the conduct of University business will be reported on the online TCU Reimbursement Form.  This form will be filed in the Financial Services Office, with all supporting documentation and receipts, within 30 days of the incurred expense.  Faculty participating in summer study abroad programs that are three weeks or longer in duration must submit reimbursement forms and all supporting documentation and receipts within 45 days of the date of their return. The reimbursement form must be personally signed by the individual incurring the expense. Reimbursement forms, like all financial documents and records, are subject to review and approval by the Financial Services Office prior to processing the reimbursement.

 A. Travel

 a. Air Travel

If a faculty or staff member elects to travel by commercial airline, reimbursement will be no greater than the most economical unrestricted coach fare available from a major carrier.  When the schedule permits, the traveler should explore the availability of discount air fares, measuring potential savings against the cost of additional meals and lodging and the risk of possible forfeiture in the event the trip is unexpectedly cancelled or delayed. TCU will not reimburse for meal expenses incurred by the traveler between the traveler’s home and airports in the DFW metroplex or for meals at DFW metroplex airports before flights or on flights originating from DFW metroplex airports.  Exceptions may be considered in cases of lengthy flight delays.

Trip insurance and seat upgrades will not be reimbursed.  If it is necessary to pay extra for preferred seat options because no other assigned seats are available at the time of booking, TCU will reimburse reasonable costs if documentation is submitted regarding the reason for incurring the additional seat costs.  The University also does not reimburse for the use of personal airline miles for business travel.

It is often to TCU’s advantage for employees to purchase airline tickets or conference packages months in advance. In fact, it is often much more cost effective for employees to book flights directly via the Internet rather than through a travel agent. In those cases, employees can be reimbursed for such travel expenses before the travel actually occurs. After incurring such expenses, the employee can request approval for a travel advance in accordance with the procedures outlined in the Expense Advance section. The employee will then receive an advance to cover the cost of the travel expenses that have already been incurred, even if the actual travel will not occur within the next 30 days. The advance will be charged to the individual’s employee account receivable (EAR) until the travel occurs. After the travel occurs, the employee must submit the expense documentation with the completed travel reimbursement form.

 1. Airport Parking

Airport parking will be reimbursed. The traveler should exercise judgment by weighing cost against other factors when considering the duration, type and location of alternate types of parking.  Mileage reimbursement for use of a personal vehicle for transportation will be allowed from/to the individual’s home to/from the airport for travel on unscheduled workdays (such as weekends).  For travel during scheduled workdays, mileage reimbursement will be allowed from/to the individual’s TCU worksite to/from the airport.  The mileage reimbursement cannot exceed the actual number of miles driven to/from the airport, for example, if the individual’s home is closer to the airport than the individual’s TCU worksite.  If the traveler chooses to have someone drive them to/from the airport rather than parking at the airport, round trip mileage to/from the airport will be reimbursed when that mileage is submitted without any parking charges.  However, the additional mileage reimbursement cannot exceed the cost that would have been incurred for airport parking for the trip.

 2. Excess Baggage

Charges for excess baggage will be reimbursed only for transporting University materials or when there is extended travel on University business.

3.  Foreign Travel

Receipts for foreign travel must be converted into U.S. dollars. The applicable conversion rate and amount should be documented on the receipt or on the reimbursement form using the foreign currency calculator tool provided with the online form at www.xe.com

b. Automobile Travel

1. Rental Vehicle

A faculty or staff member may rent an automobile if a public carrier is not available, if rental is more economical, or if the rental will materially increase the efficient use of the traveler’s time.  The use of a rental car must be for University business and not for the convenience of the individual.  A rental contract or detailed receipt must be attached to the reimbursement form.  The cost of rental should be limited to that of a compact or medium-sized car.  Optional rental car expenses such as fuel service options or GPS will not be reimbursed unless the traveler documents the specific purpose of such expense.

The University’s fleet liability carrier offers physical damage coverage on rental cars used for University business and rented in TCU’s name. An explanation of insurance coverage options is available on the Risk Management Web site at https://tcuriskmgmt.tcu.edu/

2.  Personal Vehicle (See also mileage reimbursement)

Reimbursement for the expense of using a personal vehicle for University travel will be limited to the authorized mileage rate in effect on the date of travel.  Mileage reimbursement for use of a personal vehicle will be allowed to/from the individual’s home to/from the business travel destination for travel on unscheduled workdays (such as weekends).  For travel during scheduled workdays, mileage reimbursement will be allowed to/from the individual’s TCU worksite to/from the business travel destination. If the traveler chooses to have someone drive them to/from the airport rather than parking at the airport, round trip mileage to/from the airport will be reimbursed when that mileage is submitted without any parking charges.  However, the additional mileage reimbursement cannot exceed the cost that would have been incurred for airport parking for the trip using the lowest daily parking rate.  The cost of purchasing toll passes will not be reimbursed unless the traveler documents the specific business purpose of such expense.

The vehicle owner must have public liability insurance in force with at least the minimum coverage required by Texas law.  Any damage or loss to a personal vehicle used on University business is the responsibility of the owner. Private insurance coverage serves as primary policy for third party liability and physical damage to the vehicle. Vehicle owners are responsible for any deductible under the private auto policy. When commercial air transportation is available but the individual elects to drive a personal vehicle, the total mileage reimbursement for mileage and related expenses such as hotel parking may not exceed the cost of the most economical unrestricted coach fare available (at the time that advance air transportation would have been purchased) and related expenses such as taxis/airport shuttles, mileage to/from the airport, and airport parking using the lowest daily parking rate.  Documentation of the cost of such air fare must be submitted with the reimbursement form.

2. Car Services/Taxis 

If an individual has a business reason for utilizing a taxi or car service for travel to/from the airport, reimbursement for the cost of the car service/taxi cannot exceed the cost that would have been incurred for mileage to/from the airport and airport parking for the trip using the lowest daily parking rate.  If such service is used, the cost of the service should be directly billed to TCU by the service provider rather than the individual employee directly paying the service provider/driver.

  1. Mileage Reimbursement

Reimbursements for the expense of using a personal vehicle for University travel will be limited to the authorized mileage rate in effect on the date of travel.  Mileage reimbursement is not allowed for commuting between the individual’s home and normal worksite on scheduled workdays.  Mileage reimbursement for use of a personal vehicle will be allowed from/to the individual’s home to/from the airport or other travel destinations on unscheduled workdays (such as weekends).  For travel during scheduled workdays, mileage reimbursement will be allowed from/to the individual’s TCU worksite to/from the airport or other business travel destination. The mileage reimbursement cannot exceed the actual number of miles driven to/from the airport, for example, if the individual’s home is closer to the airport than the individual’s TCU worksite.  If the traveler chooses to have someone drive them to/from the airport rather than parking at the airport, round trip mileage to/from the airport will be reimbursed when that mileage is submitted without any parking charges.  However, the additional mileage reimbursement cannot exceed the cost that would have been incurred for airport parking for the trip.  If the traveler chooses to have someone drive them to/from the airport rather than parking at the airport, round trip mileage to/from the airport will be reimbursed when that mileage is submitted without any parking charges.  However, the additional mileage reimbursement cannot exceed the cost that would have been incurred for airport parking for the trip.

When commercial air transportation is available but the individual elects to drive a personal vehicle, the total reimbursement for mileage and related expenses such as hotel parking may not exceed the cost of the most economical unrestricted coach fare available (at the time that advance air transportation would have been purchased) and related expenses such as taxis/airport shuttles, mileage to/from the airport, and airport parking.

Individuals must document the business purpose of the travel to support mileage reimbursements. The to/from destinations, as well as the date and number of miles traveled, must be documented for each individual mileage reimbursement claim.

c. Combined Business and Personal Travel

When an individual combines business and personal travel, the University will reimburse the necessary expenses required to accomplish the business portion of the trip.  A detailed explanation of expenses and allocations is required.

d. Non-Reimbursable Travel Expenses

Expenses that are not directly related to or required for official University travel but incurred for the personal use or convenience of the traveler will not be reimbursed (e.g., personal entertainment such as pay TV movies or magazines and newspapers, first class passage instead of coach or economy, excessive personal phone calls, etc.)

Trip insurance and seat upgrades will not be reimbursed.  If it is necessary to pay extra for ‘preferred’ seat options because no other assigned seats are available at the time of booking, TCU will reimburse the additional reasonable costs if documentation is submitted regarding the reason for incurring the additional seat costs.  The University also does not reimburse for the use of personal airline miles for business travel.

e. Travel Expenses as Income

Any travel advance not cleared in a timely manner as required by the IRS must be reported by TCU as additional compensation on the employee’s W-2 form.

f. Traveling with Companions

Expenses for non-employees, spouse, family members, or others who accompany faculty or staff on University business are not reimbursable unless such travel is for a specific, preapproved business purpose on behalf of TCU.

Valid Business Purpose:  TCU will not reimburse spouse’s travel expense when a spouse or other person attends a meeting or conference and has no significant role or performs only incidental duties.  Such attendance does not constitute a valid University purpose.

When a spouse who attends a function has a significant role in the proceedings such as direct responsibility for planning, production and oversight of official events or activities, this constitutes a bona fide University business purpose.  In addition, attendance as a business representative of the University at a professional conference or function, or significant involvement in fundraising activities are also considered bona fide University business purposes but must be properly documented and approved in advance of the travel for reimbursement by the University.

Pre-Approval:  Reimbursable spousal travel must be pre-approved by the appropriate Vice Chancellor or Chancellor prior to incurring the expenses.  Upon approval, TCU will reimburse the business traveler for a spouse’s non-personal expenses directly resulting from travel on University business.  Travel for spouses should not be charged to TCU accounts with travel agencies unless pre-approval for the business purpose of the spousal travel has been documented.  Such written pre-approval must be attached to any travel agency invoices or employee expense reimbursement form.

Payment of Expenses for Traveling Companions: Travel by a spouse or family member of an employee that does not serve a bona fide business purpose should be paid for by the spouse or employee individually.  Travel that is inadvertently incurred by the University and is not determined to be a bona fide business purpose must be reimbursed to the University by the employee or spouse individually.

Federal Income Taxation:  Payroll and the Financial Services office will evaluate any spousal travel that is paid for by TCU to determine whether the payment is taxable for federal income tax purposes.  If deemed taxable for federal income purposes, these amounts will be included on the employee’s W-2 in accordance with Internal Revenue Service procedures.

Meals: When being reimbursed for meals for others, the specific business purpose of the meal and the names, titles, and business relationship of all people attending the meal must be documented on the reimbursement form.  See Meals and Lodging.

B. Meals and Lodging

Faculty and staff will be reimbursed for reasonable food and lodging expenses incurred in connection with University business when filed on a reimbursement form.  The University will not reimburse excessive expenses if, for personal reasons, the individual elects to dine or stay at a premier establishment.  When expenses for food and lodging appear excessive, the person may be requested by the Financial Services Office or reviewing party to justify the perceived excess.

The detailed portion of a bill for lodging must be submitted with the reimbursement form. Meals provided for others, or group meals, must also be reported on the reimbursement form. When being reimbursed for meals for others, the specific business purpose of the meal and the names, titles, and business relationship of all people attending the meal must be documented on the reimbursement form.  TCU reimburses meals and lodging “per receipt.”  However, budget managers may establish more restrictive limits for acceptable levels of expenditure reimbursement.

IRS rules allow for nontaxable reimbursement of meals only in conjunction with overnight business trips. Reimbursements for meals incurred in conjunction with non-overnight business trips are subject to inclusion on the employee’s W-2 form and federal income taxation if the business purpose of the meal is not appropriately documented on the reimbursement form.

IRS rules allow for nontaxable reimbursement of local lodging expenses only when the expenses are for a business purpose meeting specified criteria, including the requirement that the employer required the employee to remain at the activity or function overnight.

C. Credit Cards

Corporate personal credit cards are available to staff and faculty members who are required to travel extensively on University business.  To acquire a credit card, the person must obtain approval from a vice chancellor or dean.  Those authorized to have a University credit card must file an expense report and pay the credit card bill direct.

D. Contributions or Donations

Due to its nonprofit tax status, TCU does not make contributions or donations to other universities or other nonprofit or charitable organizations. Such contributions generally do not meet the purpose of TCU’s tax-exempt status under IRS guidelines. Any such contributions or donations submitted on a reimbursement form will not be eligible for reimbursement.

E. Expense Advance

A faculty or staff member may request an “expense advance” for University related expenses in lieu of using personal funds.  This advance will be charged to the individual’s employee account receivable (EAR) and must be cleared by the submission of a properly completed reimbursement form.  Any advance drawn in excess of the actual expenses incurred should be returned to the Financial Services Office within five (5) business days of the traveler’s return.  The individual’s personal check or a copy of a TCU cashier’s receipt showing payment to the EAR must accompany the reimbursement form.  An expense advance should not be requested for expenses that can be paid directly by the University (i.e., supplies and certain travel expenses).  Expense advances not settled within 30 days after the expense is incurred may be deducted from the person’s paycheck. Unsettled expense advances for terminating employees may be deducted from the final paycheck.  Employees must sign a TCU expense advance form that acknowledges their understanding of these policies prior to disbursement of the expense advance.

Expense advances must be processed as follows:

*  Requests for expense advances must be approved by the appropriate budget manager and submitted in writing to the Financial Services Office at least five business days before the date the funds are needed.

*  After that time, expense advances will be available from the cashiers in the Financial Services Office. All expense advances will be issued in cash, unless the expense advance request specifies the need for a check.

*  Expense advances are charged to the employee who signs for the cash.

F. Gifts or Gift Certificates, Award, or Prizes

If employees are to be reimbursed for awards/prizes/gifts or gift certificates given to others, a detailed list of the names of the award/prize/gift/gift certificate recipients, as well as a designation as to whether they are TCU employees or students, must be included as supporting documentation with the reimbursement form.  The online Recipient Log for Awards/Gifts/Prizes is available to document the recipient information for reimbursements for Awards/Prizes/gifts/gift certificates.

If the award/prize/gift/gift certificate is given to a TCU employee, the value of the award/prize/gift/gift certificate is subject to inclusion on the employee’s W-2 form and to federal income taxation.  If the award/prize/gift/gift certificate is given to a TCU student, the value of the award/prize/gift/gift certificate may be reportable on Form 1099 for the student.

Since the IRS specifies that gift cards and gift certificates are cash equivalents, employee reimbursements for these expenses must include a list of recipients, including the full name of recipients, TCU ID number for employees or students (regardless of dollar value) and Social security number for nonemployees if over $100 values is provided to an individual of a gift card or gift certificate.  Gift cards may not be purchased from the TCU bookstore using the TCU departmental requisition forms.  Gift cards may not be purchased using the TCU purchasing card.

G. Grant or Contract Expenses

If expenses are to be reimbursed from a grant or contract, a prior examination of the terms of that grant or contract should be made to determine if the expense is allowable.  Reimbursements from grants or contracts must comply with applicable TCU reimbursement policies.  If the terms of the grant or contracts are more restrictive than TCU’s policies, the terms of the grant or contract will apply to the reimbursement.

H. Gratuities

Reimbursements for gratuities generally should not exceed 15%-20% of the meal or service, depending on the circumstances (such as the size of the group for a meal reimbursement). Explanations should be provided for gratuities that exceed 25%.

I. Internal Revenue Compliance

The Financial Services Office will insure that TCU’s travel expenditure and reimbursement policies, procedures, and report forms are maintained in such a way as to qualify as an “Accountable Plan” as defined by the Internal Revenue Service.  Periodic modifications to the reimbursement policy will be made, as necessary, to insure that favorable tax treatment is obtained in accordance with the IRS Code.

J. Payments for Services

Employees should not pay other individuals for services performed on behalf of TCU.  Payments for services must be made directly by the TCU Accounts Payable Department in the Financial Services Office.  If it is absolutely necessary for an employee to pay an individual for services performed on behalf of TCU, the employee must obtain a signed receipt from the individual and provide the name and social security number of the person receiving payment for the services as supporting documentation with the employee’s reimbursement form.  The payment for services will be subject to Form 1099 reporting by the Accounts Payable Department.

K. Sales and Occupancy Tax

The University is exempt from Texas sales tax.  Faculty and staff should review expenses as they are incurred to verify that sales tax has not been assessed.  In the case of hotel taxes, the University is exempt from Texas hotel occupancy tax.  The University is not exempt from the city portion of the hotel occupancy tax.  Although not required to do so, some other states also may honor the University’s exemptions.  Copies of the University’s Texas Sales Tax Exemption and Texas Hotel Occupancy Tax Exemption forms are available in the Financial Services Office.  These forms should be submitted to the hotel at the time of registration/check-in.

L. Shared Expenses

When expenses of an individual or activity are shared by TCU and any other entity, detailed explanations of expenses and allocations are required.  In a shared expense situation, copies of supporting documentation are acceptable if the original documents are not available.  It must be stated which entity received the originals.  The total reimbursement from TCU and all other sources should not exceed the cost of the activity.

  1. Purchasing Procedures 

Contact the Purchasing Agent in the Physical Plant department for information regarding purchasing policies and procedures.  Also, please see the Purchasing card Manual for cardholder policies and procedures.

  1. Reimbursement Procedure

All expenses incurred in the conduct of University business will be reported on the online reimbursement form.  This form will be filed in the Financial Services Office, with all supporting documentation and receipts, within 30 days of the incurred expense. Faculty participating in summer study abroad programs that are three weeks or longer in duration must submit reimbursement forms and all supporting documentation and receipts within 45 days of the date of their return. The reimbursement form must be personally signed by the individual incurring the expense and approved. Reimbursement forms, like all financial documents and records, are subject to review and approval by the Financial Services Office prior to processing the reimbursement.

  1. Approval of Reimbursement Form

The budget code of the department, grant, or contract being charged, along with the signature of the budget manager approving the expenditure, is required on all reimbursement forms. Reimbursements exceeding $1000 require two approval signatures (in addition to the signature of the employee submitting the reimbursement).

Faculty or staff may not authorize travel or approve expense reimbursements for themselves or for persons to whom they report.  Budget managers and other authorized approvers must review and, if they approve the stated expenditures, personally sign the reimbursement form.  Approved Reimbursement forms should be routed directly to Accounts Payable by the final approver rather than being returned to the individual being reimbursed.

  1. Documentation

Original supporting documentation (not copies) is required for all reimbursements.  The actual type of documentation required is described on the reimbursement form.

According to the Internal Revenue Code, reimbursements made without the proper supporting documentation must be reported as taxable income to the employee. The online Lost/Missing Receipts Form must be completed and approved to document individual missing receipts between $25 and $75.  The approved form must be submitted with the employee’s TCU Reimbursement Form.

In Accordance with IRS rules, the business purpose of each expense on the reimbursement form must be clearly documented. This includes complete documentation for all meals provided for others (see Meals and Lodging) and other expenses.

Reimbursement forms that do not contain complete documentation of the business purpose of the expense will be returned for further documentation before processing the reimbursement. The IRS requires that the business purpose of reimbursable expenses be documented in a manner that is clearly apparent to an outside auditor.

According to the Internal Revenue Code, reimbursements made without the proper supporting documentation must be reported as taxable income to the employee.  (Also see Shared Expenses.)