[Anonymous]

I’ve seen this phrase quite a few times and just want some clarification as to what it means.

For example, my book says travel expenses are deductible for AGI if incurred in a trade or business but deductible from AGI if un-reimbursed to an employee.

Does un-reimbursed to an employee mean the expenses are paid directly by the business versus the employee paying for the expenses and then being reimbursed later?

Thanks in advance.

[Anonymous]

Unreimbursed means that the employer will not compensate/repay the employee for expenses incurred. These are generally an itemized deduction subject to the 2% floor.

Reimbursed means the employee incurred the expense on his/her own dime but the company paid the employee later for it. These are not deductible because the employer ultimately pays for it.

If you have qualified moving expenses, the unreimbursed portion is an adjustment to come to AGI.

[Anonymous]

Unreimbursed means that the employer will not compensate/repay the employee for expenses incurred. These are generally an itemized deduction subject to the 2% floor.

Reimbursed means the employee incurred the expense on his/her own dime but the company paid the employee later for it. These are not deductible because the employer ultimately pays for it.

If you have qualified moving expenses, the unreimbursed portion is an adjustment to come to AGI.

[Anonymous]

Beardown- Unreimbursed expenses means the employer did not reimburse the employee for the expense. An example would be if an employee traveled to a conference for a job and paid for my mileage or hotel and the employer did not reimburse them. Maybe the employer pays commissions on the sales made at the conference, but they won't cover the employee's travel. The mileage and hotel would be deductible from AGI.

[Anonymous]

Beardown- Unreimbursed expenses means the employer did not reimburse the employee for the expense. An example would be if an employee traveled to a conference for a job and paid for my mileage or hotel and the employer did not reimburse them. Maybe the employer pays commissions on the sales made at the conference, but they won't cover the employee's travel. The mileage and hotel would be deductible from AGI.

[Anonymous]

Alright, so if the employer does not reimburse the employee, the expenses are deductible from AGI. If the employer reimburses the employee, the employee can't deduct it.

In what case will the expense be deductible for AGI then?

[Anonymous]

Alright, so if the employer does not reimburse the employee, the expenses are deductible from AGI. If the employer reimburses the employee, the employee can't deduct it.

In what case will the expense be deductible for AGI then?

[Anonymous]

Unreimbursed Qualified Moving Expenses (when you get a new job across states, for example) are deductible for AGI (above the line).

[Anonymous]

Unreimbursed Qualified Moving Expenses (when you get a new job across states, for example) are deductible for AGI (above the line).

[LaxCPA]

It would be “for AGI” if the taxpayer is self employed.

[LaxCPA]

It would be “for AGI” if the taxpayer is self employed.

[Anonymous]

While self-employment items are technically “above the line” I think it is incorrect to say self-employment expenses are “for AGI” as this implies all self-employment expenses are a “for AGI” deduction – they're not. Self-employment expenses are netted against self-employment income on the Schedule C, which contributes to Gross Income. The only self-employment “for AGI” deductions are 50% of SE tax, SE health insurance, and SE SEP plans.

[Anonymous]

While self-employment items are technically “above the line” I think it is incorrect to say self-employment expenses are “for AGI” as this implies all self-employment expenses are a “for AGI” deduction – they're not. Self-employment expenses are netted against self-employment income on the Schedule C, which contributes to Gross Income. The only self-employment “for AGI” deductions are 50% of SE tax, SE health insurance, and SE SEP plans.

[LaxCPA]

I think a schedule C is what the book is referring to when it says travel expenses are deductible for AGI if incurred in a trade or business in the original post. you could make the argument anything from line 7-36 on the 1040 is “for AGI.”

[LaxCPA]

I think a schedule C is what the book is referring to when it says travel expenses are deductible for AGI if incurred in a trade or business in the original post. you could make the argument anything from line 7-36 on the 1040 is “for AGI.”

[Anonymous]

That's why I said it is “technically” correct but it leads to confusion, since Gross Income items are very different from Adjusted Gross Income items. You are right, travel expenses for self employment are a Schedule C item, but I believe the “travel expenses for AGI” referred to in the OP are actually moving expenses, which are an adjustment and have nothing to do with Schedule C. If you were self-employed and moved, you cannot have any “moving expenses.”

[Author]

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