EXPENDITURE REIMBURSEMENT WHILE ON LEAVE OF ABSENCE
November 11, 2010
In limited circumstances, the Dean of the Faculty will approve reimbursement of expenses incurred while a faculty member is on leave of absence. These expenses will not be reimbursed from “general fund” sources or from Dean of Faculty sources. To qualify as reimbursable, the faculty member must utilize either their “2xxx” account where approval has been granted for expenditure reimbursement while on leave or they must be on public service leave with the WWS/or other academic unit agreeing to pay for these expenses.
To qualify for reimbursement of rental expenses while on leave of absence, faculty members must meet the following criteria:
- There has to be a strong research-specific purpose for the locale where the faculty member is renting while on leave. In other words reimbursing a rental in Cambridge because the faculty member is working on research with specialized equipment and with colleagues who work at MIT may be OK. Renting a house on the beach because "I write better on the beach" would not be appropriate.
- The Faculty member may not be reimbursed for their primary residence--this is a personal expense intended to be covered by salary. Therefore, the faculty member must be maintaining their primary residence in the Princeton vicinity while they are incurring rental expenses on leave. They cannot be renting or subletting their primary residence since then their primary residence would be the rental property during that period.
- The rental expenses must be financially justifiable, in other words, these expenses must be less than the cost of a hotel or other alternative.
- The University will only reimburse the rental associated with the faculty member him or herself.
- If the faculty member is earning wage income above their Princeton FTE salary while on leave, the University will not reimburse these rental expenses.
- To be reimbursable, these expenses must be properly substantiated and submitted within the time frame specified in Princeton’s Expense Reimbursement Deadlines Policy.
These time limitations determine both whether the cost may be reimbursed by the University as a business expense, and whether that reimbursement will be treated as taxable income to the individual.
The University has adopted an "accountable plan," which allows it to reimburse properly substantiated business expenses without including the reimbursement in the taxable income of the individual incurring the expense. "Accountable plan" standards established by the Internal Revenue Service (“IRS”) require that the expense must be an "ordinary and necessary expense" of operating a business, must be substantiated in writing within a “reasonable time” of the incurrence of the expense, and that all unsubstantiated amounts advanced must be returned within a “reasonable time”.
If the written substantiation for the rental reimbursement is submitted within 60 days of when the expenses and if all the other points of the policy were fulfilled, it would be treated as a reimbursable expense.
If written substantiation occurs more than 60 calendar days after the expenses were incurred or after returning from travel, the expense reimbursement request must be sent to the Dean of the Faculty (for faculty members) or to the Vice President for Finance and Treasurer (for all non-faculty). The request should include an explanation for the delay. At the discretion of the Dean or Vice President for Finance and Treasurer, reimbursement requests beyond the 60-day limit may be approved. In all such cases, the reimbursement must be reported to the IRS as taxable income paid to the individual.
MOVING COSTS OF SHIPPING GOODS TO AND FROM LEAVE LOCATION: