Local Business Meals

School: Southern New Hampshire University - Course: COM MISC - Subject: Accounting

Hospital-wide Policy Title::Local Business Meals Issuing Department:Finance Effective Date:August 2014 IMPORTANT NOTICE: The official version of this policy is contained in the Policy and Procedure Manager (PPM) and may have been revised since the document was printed. I.Purpose The purpose of the Local Business Meals Policy of Tufts Medical Center and named Affiliates (Tufts MC) is: •To provide employees with clear, consistent guidelines relating to the reimbursement of local business meals expenses. •To ensure proper documentation is obtained in accordance with internal and external guidelines, e.g., Internal Revenue Service, Granting Agencies, etc. •To ensure that Tufts MC receives the greatest value for its business expenditures, and •To set standards for employees in advance of the expenditure and make certain that employees are reimbursed promptly for legitimate, necessary and reasonable expenses. II. Scope This policy applies to all employees, staff members, residents, students, volunteers, researchers and physicians of Tufts MC. III. Policy It is the policy of Tufts MC to reimburse employees for meals with other guests in local restaurants when the meetings have a clear substantiated business purpose and are directly associated with the active conduct of Tufts MC business.Meals with other Tufts MC employees, including Tufts Medical Center Physicians Organization (PO) employees, in local restaurants are generally not reimbursable unless approved by management in advance. IV. Procedure Employees are responsible for complying with Tufts MC policies and applicable laws and regulations governing business expenses and their reimbursement.When in doubt, employees should consult this policy, their supervisor or the Director of Internal Audit. The cost of employee's meals (breakfast, lunch or dinner) consumed locally, including tax and reasonable gratuity, is generally reimbursable only when the meals serve a defined

2 Printed copies are for temporary reference onlybusiness purpose.Otherwise, meals are not reimbursable.IRS regulations require that local business meals expense reimbursement claims must: •Show the date, name of restaurant and cost of the meal; •Identify all participants including their business affiliations; and •Clearly describe the business purpose of the meeting in sufficient detail to identify the intended benefit to Tufts MC. IRS Publication 529, Miscellaneous Expenses, specifically states that expenses of lunches with co-workers are not deductible except when traveling away from home.Employees are basically expected to take care of their own personal meal needs as they would on any other regular workday.In those rare situations when business meetings between co-employees or colleagues from the same organization could not be done in the office or at another time, managers may authorize meal reimbursement provided the business criteria is also met and documented. IRS rules state that one cannot deduct expenses for meals that are lavish or extravagant.IRS rules further state that "an expense is not considered lavish or extravagant if it is reasonable considering the facts and circumstances."The Tufts MC Travel Policy provides the following guideline for meal reimbursement (includes a gratuity not to exceed 18% and applicable tax): Breakfast$15.00 Lunch$20.00 Dinner$50.00 Tufts MC Travel Policy provides that alcoholic beverages will be reimbursed, but such expenses should be appropriate and reasonable, e.g., a bottle of wine should not exceed $80. If expenses are not adequately documented, the Internal Revenue Service (IRS) can, upon audit, require Tufts MC to treat the reimbursement of such expenses as additional employee compensation subject to federal and state income taxes.