rom 2106

Department of the Tr
Internal_Revenue Se

uy

Employee Business Expenses
(Please use Form 3903 to figure moving expense deduction.)

D> Attach to Form 1040.

1978

Your name

Social security number

Occupation in which expenses were incurred

Employer's name

Employer’s address

Instructions

Use this form to show the total amount of
business expenses you had as an employee in
1978. Include all business expenses:

(a) You paid as an employee;

(b) You charged to your employer (for exam-
ple, with credit cards);

(c) For which you received an advance, al-
lowance, or reimbursement.

The following publications give detailed infor-
mation on business expenses you can deduct as
an employee:

Publication 463, Travel,
Gift Expenses;

Publication 529,
and Credits;

Publication 587, Business Use of Your Home;

Publication 508, Tax Information on Educa-
tional Expenses.

Part I—Travel, transportation (but not com-
muting to and from work), meals and lodging,
and some other business expenses can be de-
ducted even if you do not itemize your deduc-
tions on Schedule A (Form 1040).

If you use your own car for your work, you
can deduct what it cost you for business’ use.

Entertainment, and

Miscellaneous Deductions

You may figure your cost using actual expenses
(gas, oil, repairs, depreciation, etc.) or a stand-
ard mileage rate.

The mileage rate is 17 cents a mile for the
first 15,000 miles and 10 cents for each mile
over 15,000. Add to the mileage rate amount
the business portion of automobile interest and
State and local taxes (except gasoline tax), park-
ing fees, and tolls. For cars fully depreciated
under the straight line method, the mileage rate
is 10 cents a mile for all business mileage.
Your car will not be considered fully depreciated
if you use only the mileage rate method to figure
the cost of your car's business use for the en-
tire period you own it. (Publication 463)

Your meals and lodging costs can be de-
ducted if you were temporarily away on busi-
ness from the general area of your main place of
work. You cannot deduct the cost of meals on
daily trips where you did not need sleep or rest.
(Publication 463)

An outside salesperson (one who does all sell-
ing away from the employer's place of business)
who had business expenses other than those
listed on lines 1, 2, and 3, such as selling ex-
penses, stationery, and postage should list such
expenses on line 4. A driver-salesperson whose
main duties are service and delivery (for exam-
ple, delivery of bread or milk) is not considered
an outside Salesperson. (Publication 463)

Other business expenses must be listed and
their amount entered on line 5, Part | only if your
employer paid (reimbursed) the expenses and
you did not list them on line 1, 2, or 3. List only
the amount of the expense that your employer
paid (reimbursed). If the expense was larger
than the amount of reimbursement, list the
difference in Part Il. (Publication 463)

Part Il—Other business expenses not paid by
your employer can only be deducted if you item-
ize your deductions on Schedule A (Form 1040).
Examples of these expenses are union or pro-
fessional dues, tools, uniforms, materials, and
telephone calls, that your employer did not pay
for. (Publication 529)

Expenses for business use of part of your
home can only be deducted if that part is used
exclusively and continuously in connection with
your work and for the convenience of your em-
ployer. (Publication 587)

Part Ill—Give information on educational ex-
penses in this part. Generally, you can deduct
expenses for education that helps you maintain
or improve your skills in your present job. You
can also deduct costs of education required by
your employer, the law, or regulations to keep
your present salary or job. You cannot deduct
expenses for study that helps you meet mini-
mum requirements for your job, or helps you
get a new job. (Publication 508)

PART I.—Employee Business Expenses Deductible in Computing Adjusted Gross Income on Form 1040, Line 31

Fares for airplane, boat, bus, taxicab, train,etc.. . . . . «

1

2 Meals and lodging. . . . . . .
3 Car expenses (from Part IV)... -
4

Outside salesperson’s expenses (see Part | instructions above)

5 Other (see Part | instructions above) >.

Add lines 1 through5. . . . .

Employer's payments for above expenses ; (other than amounts included on Form W-2) .

6
7

8 Excess expenses (subtract line 7 from line 6). Enter here and include on Form 1040, line23. . . . .
9 Excess payments (subtract line 6 from line 7). Enter here and include on Form 1040, line 20.

PART II.—Employee Business Expenses that are only Deductible if You Itemize Deductions on Schedule A (Form 1040)

1 Business expenses other than those included above (specify) >

2 Total

If you itemize your deductions, deduct under Miscellaneous Deductions, Schedule A (Form 1040).

PART III.—Additional Information to be Furnished When Claiming a Deduction for Educational Expenses

1 Name of educational institution or activity D>.

2 Address P__

3 Was this education needed to meet the minimum requirements for your job?.
4 Will this study program qualify you foranewjob?. . . 2... wee

sone ee [J No
soe ee ee «FF Yes [No
5 If your answer to question 3 or 4 is “No,” state your reason for getting the additional education and show the relationship between

the courses taken and your job during the period. (If more space is needed, attach a statement) P.

Cl Yes

6 List the principal subjects studied, or describe your educational activity >_

263-129-1

Form 2106 (1978)


Form 2106 (1978)

Page 2

PART iV.—Car Expenses (Use either the regular or the optional method.)

Car 1 Car 2 Car 3
A. Number of months car was held for business use during the
year sw wee So months months months
B. Total mileage for months in line A, above . . . miles miles miles
C. Portion of total mileage that applied to business miles miles miles
Regular Method—Actual Expenses (Include expenses for only ‘the number of months shown in line A, above.)
1 Gasoline, oil, lubrication, etc... se 1 ee ee
2Repairs 2
3 Tires, supplies, etc. coe
4 Other: (a) Insurance. 2 ee ew ee ee ee
(b) Taxes 2 ee
(c) Tags and licenses... 7. wee
(d) Interest. © ee ee ee
(e) Miscellaneous. . 2 1 ee ee ee
5Total . 2 1. soe soe ee
6 Percentage of expense that applied to business (divide line C
by line B, above) . . . Lae & % %
7 Business portion (multiply line 5 by ‘ine 6) to ee
8 Depreciation from Part VI, column (h) . 2. ew ee
9 Divide line 8by12months . 2 2. 1 1 ee ee
10 Multiply line 9 by line A, above . . eee we we
11 Total (add line 7 and line 10) (see line19) . . ss.
Optional Method—Standard Mileage Rate
12 Enter the smaller of 15,000 miles or the combined mileage from lineC, above. . . « toe miles
13 Multiply line 12 by 17¢ (10¢ if car is fully depreciated under straight line method) and enterhere. . .
14 Enter any combined mileage from line C that is over 15,000 miles... . 6 eee ee ee miles

15 Multiply line 14 by 10¢ and enter here. . -
16 Total mileage rate expense (add lines 13 and 15) .

17 Business portion of car interest and State and local taxes (other than m gasoline tax). ee ee ee

18 Total (add lines 16 and 17)... - -

Summary:

19 Enter amount from line 11 or line 18, whichever is used. .

20 Add parking fees and tolls .
21 Total (add lines 19 and 20). Enter here andj in Part I, line 3.

PART V.—Computation of Car Basis

Trade-in of Old Car:

New Car:

1 (a) Total mileage accumulated miles_| 10 Purchase price or other basis . .
(b) Portion that applied to business . miles _| 11 Estimated salvage value. . . .
(c) Percentage that applied to business 12 Difference (subtract line 11 from line
(divide line (b) by line (a)) . . «(EE 50)
2 Purchase price or other basis . 13 Multiply line 12 by the percentage on
3 Trade-in allowance . line 6 of Part IV . soe
4 Difference (subtract line 3 from line 2) : ——| 14 To the amount on line 13, subtract
5 Multiply line 4 by percentage on line 1(c) gain or add (loss) on line 9 .
6 To amount on line 5, subtract gain or 15 Basis for figuring depreciation .
add (loss) on previous trade-in. . Note: If you acquired the car for cash only, or by trade-in of
7 Balance another car not used in business, complete only lines 10
8 Depreciation allowed or * allowable through 15. If you acquired it by trade-in of another car
9 Gain (Subtract line 7 from line 8) or previously used in business, complete lines 1 through 15.
(loss) (Subtract line 8 from line 7) on (Refigure the basis for depreciation each succeeding year
business portion . Dey if the percentage of business use changes.)
PART VI.—Car Depre
Make and style of car Basis (rom line | Age of car] Depreciation allowed | Method of figuring | Rate (

hen acquired
(a) (e) ©) we a

in previous years
(S)

or life ge)

depreciation
(a)

‘Ye US, GOVERNMENT PRINTING OFFICE : 1978—-0-263-129

263-129-1