Uniform Allowance - taxed?
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Re: Uniform Allowances.......
Thanks and stay safe!!
My agency just started taxing the clothing allowance checks for the first time ever, citing that per the IRS they have too. We're planning on filing a grievance through the union, so I'm interested in seeing how many agencies are taxed on clothing allowances. I know when I worked in Mass for (2) different agencies we we're never taxed. Any input would be appreciated.Gil @ Fri 13 Aug said:
Thanks and stay safe!!
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Re: Uniform Allowances.......
We get two checks a year one is for clothing and the smaller of the two is for cleaning expenses (dry cleaning). Up to a few years ago these checks were not taxed, that is until one of the retired cops wanted to have his cleaning and clothing checks figured into his total income for retirement benefit purposes. Now an 800+ checks nets about five and change for uniforms etc...
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Wow, if i may chime in here....
They are pre-reimbursing you for out-of-pocket expenses related to work, and I personaly find it crazy that it's taxable income!
I incur nearly $150/week in business expenses (company car among other things), and I submit receipts, and am reimbursed in it's entirety. Why is it any differant for you guys? If it becomes a standard taxation, I'de suggest re-arranging the program, so you are post-reimbursed for the expenses. (i.e. you make the purchases, sumbit receipts, and they reimburse up to the XXX dollar amount)
Sorry to hear you're getting whacked like that, especialy do to one's selfishness, I know I wish I could claim my 10,000$ in expenses a year and have some go to my IRA, not the IRS.....
They are pre-reimbursing you for out-of-pocket expenses related to work, and I personaly find it crazy that it's taxable income!
I incur nearly $150/week in business expenses (company car among other things), and I submit receipts, and am reimbursed in it's entirety. Why is it any differant for you guys? If it becomes a standard taxation, I'de suggest re-arranging the program, so you are post-reimbursed for the expenses. (i.e. you make the purchases, sumbit receipts, and they reimburse up to the XXX dollar amount)
Sorry to hear you're getting whacked like that, especialy do to one's selfishness, I know I wish I could claim my 10,000$ in expenses a year and have some go to my IRA, not the IRS.....
Taxed? How can they "tax" you on clothing when there not even a state tax on it? :?
Heck we dont even get an allowance,never mind a tax. Our system works like this:
Jesse:Hey captain.
Captain: Yes,
Jesse: I need a new shirt,hat,pants,boots,helmet.....etc cause my________ are worn,fadded, ripped,damaged,not NFPA complient anymore.
Captain: Ok,here you go, sign this and go see ed at FEMA logistics up stairs.
Heck we dont even get an allowance,never mind a tax. Our system works like this:
Jesse:Hey captain.
Captain: Yes,
Jesse: I need a new shirt,hat,pants,boots,helmet.....etc cause my________ are worn,fadded, ripped,damaged,not NFPA complient anymore.
Captain: Ok,here you go, sign this and go see ed at FEMA logistics up stairs.
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Cleaning allowance? Never heard of it.
I voted "no" but I meant to click "yes." In the past we were not taxed, but now we are. The money goes right into our paychecks twice a year.
For me, it goes towards my vacation spending money and Christmas presents. I never spend my allowance on uniforms!
I voted "no" but I meant to click "yes." In the past we were not taxed, but now we are. The money goes right into our paychecks twice a year.
For me, it goes towards my vacation spending money and Christmas presents. I never spend my allowance on uniforms!
When I worked for Municipal we got 550 a year one check on July 1 for 275 and one on dec 1 for 275. It was in the check and taxed accordingly. Now that I work for the Commonwealth we get 700 which is a voucher at the local police supply place and we get the whole 700 only taxes paid are on the mechandise you buy if its taxed. the 700 does not show up on my paycheck so I am curious how to handle this come tax time but I am sure my accountant will handle it along with the other deductions I have.
some may think this is a dumb question, but had anyone tried to claim their hair cuts on their taxes ?? I know we can do uniforms and what not But Hair cuts need to be short and clean cut (are part of the uniform) I spend 20 bucks every two weeks for my hair to keep a close crop. has anyone tried it or not ??
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We are all getting issued NExtel Phones and if we go over the 1000 minutes the extra can come out of our uniform allowance. I wanted to buy a Glock 27 for details but finally we got some money and we are all getting one. I don't know, we have officers that buy stuff from different vendors, get a receipt and submit it and get reimbursed.
Oddly being first and foremost a math guy I give the following advice:
1. You are much better off in the long run NOT to take the money as income and have it added to your pension. It's a fools game as the money that you lose today (in today's dollars) will be nothing compared to the money that you will get as a portion of your retirement in tomorrows dollars.
Simple version; they are going to take 30% at least on your money today. That would mean that you would have to make AT least a 70% return on your money at inflation dollars to make it work (Loss of money today 30%, loss of 5% investment return, inflation at 3%).
2. If you pay for it and you can document it, you can deduct it. Some thing to consider, the more you deduct the higher the risk of audit (doesn't matter what the IRS says...it's true). You may only be able to collect a portion of you expenses based on what a "normal" person may do. I get a haircut every month, if you get two every month, quite possibly one one would be deductable the other not. You may want to consider is that $240 a year as a deduction going to make a big difference in your taxes, is it worth the record keeping, and the potential for an audit.
3. Consider you income and what your deductions are as part of that income. If you are finding that you have deductions totaling more than 8-10% of your income based solely on work expense...it would be a good time to renegotiate your contract.
4. Cafeteria programs: It's not very popular but you might consider a cafeteria program where you can use x dollars for any legitimate police expense. Typically you would get a "expense" credit of $1000 a year to be used for any legitimate expense related to police work. The list of legitimate expenses would be agreed upon before acceptance...but then any expense on the list could be...well ...expensed.
5. Pre-tax dollars: Again not popular but certainly helpful, if you could set up a plan where purchases are made in "pretax" dollars you would lose nothing on reimbursement, you would actually decrease your taxable income, and you would still have the benefit of the equipment.
1. You are much better off in the long run NOT to take the money as income and have it added to your pension. It's a fools game as the money that you lose today (in today's dollars) will be nothing compared to the money that you will get as a portion of your retirement in tomorrows dollars.
Simple version; they are going to take 30% at least on your money today. That would mean that you would have to make AT least a 70% return on your money at inflation dollars to make it work (Loss of money today 30%, loss of 5% investment return, inflation at 3%).
2. If you pay for it and you can document it, you can deduct it. Some thing to consider, the more you deduct the higher the risk of audit (doesn't matter what the IRS says...it's true). You may only be able to collect a portion of you expenses based on what a "normal" person may do. I get a haircut every month, if you get two every month, quite possibly one one would be deductable the other not. You may want to consider is that $240 a year as a deduction going to make a big difference in your taxes, is it worth the record keeping, and the potential for an audit.
3. Consider you income and what your deductions are as part of that income. If you are finding that you have deductions totaling more than 8-10% of your income based solely on work expense...it would be a good time to renegotiate your contract.
4. Cafeteria programs: It's not very popular but you might consider a cafeteria program where you can use x dollars for any legitimate police expense. Typically you would get a "expense" credit of $1000 a year to be used for any legitimate expense related to police work. The list of legitimate expenses would be agreed upon before acceptance...but then any expense on the list could be...well ...expensed.
5. Pre-tax dollars: Again not popular but certainly helpful, if you could set up a plan where purchases are made in "pretax" dollars you would lose nothing on reimbursement, you would actually decrease your taxable income, and you would still have the benefit of the equipment.
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