Employee Benefits Blog

Posts tagged accountable plans

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New IRS Ruling on Accountable Plans and Wage Recharacterization

On September 10, 2012, the IRS issued Revenue Ruling 2012-25 regarding the circumstances under which payments to employees can be treated as tax-free expense reimbursements under the “accountable plan” rules.  While the ruling does not appear to represent a significant departure from earlier IRS pronouncements, it does provide a thorough reiteration and summary of the “accountable plan” rules, especially of the “wage recharacterization” component of the rules.