May 15, 1990
COMPTROLLER'S MEMORANDUM NO. 15 (1989-90)
SUBJECT: PAYMENT OF CERTAIN CLASS C MEAL
ALLOWANCES AND MONTHLY MILEAGE ALLOWANCES
The Internal Revenue Service has issued
regulations which require employers to withhold income tax and
social security tax on payments of certain employee business expense
reimbursements and allowances, effective July 1, 1990. Our research
indicates that Class C meal allowances and monthly mileage allowances
paid pursuant to Sections 112.061(6) (b) and 112.061(7) (f), Florida
Statutes, respectively, would be subject to this requirement.
In order to accomplish this withholding, the payment of these
amounts to employee travelers will be transferred from the Voucher
Audit System to the Payroll System beginning on July 1, 1990.
Below is a description of the procedures
to be followed in order to implement this change. We are presenting
this information in three categories: General Information which
applies to both Class C meal allowances and monthly mileage allowances;
Class C Meal Allowances; and, Monthly Mileage Allowances.
General Information
It is important to note that the change
in procedures for the payment of these allowances applies only
to payments to employees filling established positions as well
as those not filling established positions. Payments of such
amounts to nonemployees should continue to be paid through the
Voucher Audit System as they have been historically.
Effective July 1, 1990, a weekly payroll
schedule has been established to process these payments. Because
these payments will not be made at the time we pay the employees' regular wages, they will be subject to the 20% withholding of
income tax rule. Once a person has paid the maximum FICA taxes,
the payments will not be reduced by the 7.65% FICA or the 1.45%
Medicare Tax, whichever is applicable.
This special weekly payroll will usually
be processed on Wednesday. The warrants will be printed the night
of the payroll processing and are scheduled to be released to
the agencies two working days later. Because this is a special
payroll and there is only a brief time period between warrant
preparation and warrant release, there will be no EFT (direct
deposit) for this payroll.
The payments will be made on salary
warrants and will be attached to a complete earnings statement
with year to date information as well as information regarding
the specific payment. For this reason, agencies may want to follow
their salary warrant distribution procedures for these warrants.
Because the taxes to which these payments
are subject must be withheld from the payments themselves, effective
July 1, 1990, agencies are prohibited from making payments of
Class C meal allowances and monthly mileage allowances to employees
from revolving funds. All such payments must be made through
the Payroll System. Other types of travel expenses may be continued
from an approved revolving fund for that purpose.
The change in the method of paying
Class C meal allowances and monthly mileage allowances will mean
that these amounts are no longer automatically recorded in the
Departmental Accounting System. The Bureau of State Payrolls
will make available a magnetic tape of this payment data in the
standard payroll record format. Agencies wishing to receive this
magnetic file should request it in writing from the Bureau of
State Payrolls.
The Bureau of State Payrolls will
publish instructions concerning the preparation of form DBF-BP-34
for Class C meal reimbursements as Volume V, Section 13, of the
Payroll Preparation Manual. This section and the revised payroll
schedule showing the processing dates for Class C meal allowances
and monthly mileage allowances will be distributed June 1, 1990
to all holders of the Payroll Manual and to all individuals on
the Comptroller's Memorandum mailing list. Additional copies of these instructions
may be requested from the Bureau of State Payrolls.
Class C Meal Allowances
Employees should continue to complete
a Voucher for Reimbursement of Travel Expenses, Form DBF-AA-15,
for all travel expenses incurred, including Class C meals pursuant
to Chapter 3A-42, Florida Administrative Code. However, the form
has been amended to include a column for segregation of Class
C meal amounts from all other expenses claimed. A line in the
"Totals" area for reducing the amount claimed has been provided for Class
C meals. In the event the employee has expenses claimed in addition
to Class C meals on the same Voucher for Reimbursement of Travel
Expenses, the amount of the Class C meals should be deducted in
order for the other expenses to be processed through the Voucher
Audit System. A copy of the revised Voucher for Reimbursement
of Travel Expenses, Form DBF-AA-15, is attached.
Class C meal allowances will be submitted
on Form DBF-BP-34 to the Bureau of State Payrolls. This is a
new nonrecurring compensation requisition form which was designed
specifically for Class C meal allowances. A supply of Form DBF-BP-34
will be distributed to the Finance and Accounting Office of each
agency by June 1, 1990. Additional supplies of the form can be
obtained by contacting the Bureau of State Payrolls. A copy of
the new form is attached. If the employee is only claiming Class
C meal allowances, then the employee should complete the Form DBF-AA-15
and attach it to the DBF-BP-34. If the employee has other expenses
claimed, the form DBF-AA-15 will be attached to the voucher that
is processed through Voucher Audit.
An agency that has an alternative
Voucher for Reimbursement of Travel Expense form approved by the
Bureau of Auditing to be used in lieu of Form DBF-AA-15, should
incorporate the changes in the DBF-AA-15 into its alternative
form. Bureau of Auditing approval of these changes will not be
required but nonconforming forms may be rejected by the Bureau
of Auditing if submitted for payment.
Class C meal allowances will continue
to be subject to the provisions of Section 215.422, Florida Statutes.
However, since they will no longer be paid through Voucher Audit,
they will not be monitored by the automated monitoring system.
It will be the responsibility of each agency to promptly pay
such amounts and any interest penalty accruing to its employees
for failure to promptly pay.
Monthly Mileage Allowances
Comptroller's Memorandum No. 14 (1989-90) established Object Code 265000 for Mileage Allowances and gave instructions for reporting payments
made between January 1, 1990 and June 30, 1990. Payments to be
made July 1, 1990 and after should be reported to the Bureau of
State Payrolls on form DBF-BP-33 and must be clearly marked as
"Mileage Allowance." Bureau staff will enter the necessary Key Code and the payments
will be processed on the special payroll with Class C meal payments.
If you have any questions regarding
the submission of these reimbursement requests to the Bureau of
State Payrolls, please call Phyllis Burkhart at 488-7762, Suncom
278-7762. Questions regarding the taxation of these payments
should be directed to Patti Calhoun at 488-7762, Suncom 278-7762.
Questions regarding the effect of these changes on the Departmental
Accounting System and Voucher Audit process should be directed
to Elwood McElhaney at 488-8424, Suncom 278-8424. Questions regarding
the changes to the Voucher for Reimbursement of Travel Expenses,
Form DBF-AA-15, and travel in general, should be directed to Steve
Wilson, 488-4098, Suncom 278-4098.
THIS MEMORANDUM INCLUDED AN ATTACHMENT WHICH CANNOT BE TRANSMITTED. IF YOU WOULD LIKE TO OBTAIN THIS DOCUMENT, PLEASE CALL THE BUREAU OF AUDITING AT 488-4094.
