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Get Ready: Business Expense Substantiation & Tax Implications

The Procurement Service Center (PSC) and Office of University Controller (OUC) have recently researched and clarified aspects of the current Business Expense Reimbursement policy. The result is the revised Finance Procedural Statement Business Expense Substantiation & Tax Implications, which is planned to take effect on January 1, 2023. You can link to the new procedures and several related resources from the OUC's Finance Procedural Statements website.

If you submit travel or other reimbursement expense reports in Concur, you may already be familiar with current requirements for substantiating/submitting business-related expenses that you've covered personally. With the revised procedures, requirements for timely substantiation/submission of business expenses apply to commercial credit card transactions (Procurement Card, Travel Card, Airfare Card) and to cash advances, in addition to employee reimbursements. Failure to comply with these requirements within 90 days of end of trip or (for non-travel expenses) within 90 days of date the expense was incurred, will result in the full amount being reported as taxable income to the employee.

One of our top questions has been, Why are Procurement Card cardholders subject to taxation on expenses that their department asked them to make, just because they didn't substantiate them within the required timeframe?

  • Per Internal Revenue Code, use of a corporate-liability credit card is similar to receipt of a cash advance in that the funds are being made available to the employee in advance of the employee documenting their appropriate use. Failure to substantiate timely means the expense has not been proven to be a business expense as required by the University's accountable plan.
  • The IRS has indicated that substantiation within 60 days from the date the expense was incurred would be considered timely substantiation, unless the organization creates, implements and manages an alternate accountable plan. While many of our peer institutions follow the 60-day window (and some allow only 30 days in their individualized accountable plan), at CU we've established a 90 day window, given the complexities of our organization.

Getting Ready

As we approach the effective date of this upcoming policy, you can prepare by ensuring that all aging expenses in Concur are assigned to a report and submitted as appropriate.

  • If your transaction date or trip end date is approaching 90 days aging, complete the expense report or reconciliation and submit it into the workflow as soon as possible.
  • If your transaction date or trip end date is past 90 days, submit it in Concur immediately.
  • If your transaction is for a trip that has not yet occurred, create a Travel Expense Report for the trip, including the trip dates in the report header, and assign the individual aging transaction(s) to that report for future submission, after the trip concludes.   

The PSC will continue to send individual employee notifications on unsubmitted commercial card transactions that are aging, even after the new policy takes effect. We are committed to helping employees manage their aging commercial card expenses, and heeding these email notifications will help ensure business expenses are not reported as taxable wages for failure to submit on time. Submissions that are fully approved and paid on or after January 1, 2023 that fail to satisfy the accountable plan requirements will be reported as taxable wages, even if the associated transactions occurred in 2022.

Resources and Questions:

We encourage you to visit the new website to review the revised procedural statement and to check back often for additional updates and resources. If you have questions, please use the feedback form at the bottom of the Finance Procedural Statement Business Expense Substantiation & Tax Implications page to submit them.



Jennifer Weber

One of the major challenges we run into with taxation is that trainees and faculty need to register for conferences they are presenting at more than 90 days in advance.  We cannot reimburse for this expense until the travel has been completed.  There should be an exception in this case as each party is taxed due to system reimbursement policy.


Good morning Jennifer,
It is true that reimbursements for conferences (similar to an exam or a course) would not be reimbursable until after its been completed. Typically, a conference would be part of a travel report in which case the trip begin and trip end dates are required in report header. A travel report has 90 days from that trip end date to be submitted in concur by the employee. The BEX determination is based off that trip end date and the first submit date, regardless of the transaction date.
In the case of a conference, exam, or course not being associated with travel, the report would need to be reviewed to ensure the completion date, and would only be taxed if the report was submitted more than 90 days after that completion date, regardless of the transaction date.
If a notice of BEX regarding a report is received, and you believe the BEX is incorrectly determined, you can reach out to the PSC helpdesk to inquire, If report was in fact submitted beyond the 90 days of trip end date/completion date, it is taxable. Only in extenuating circumstances could the report be reviewed for exception to that BEX tax by the departments campus controllers office and CU Tax director.

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