My employer reimburses continuing medical education (CME) expenses, such as conference travel, medical licensing, journal subscriptions, etc. It's basically an accountable plan, and the reimbursements are not reported as income and do not appear on my W-2. Last year they approved the purchase of a laptop, which I made using my own after-tax money and was reimbursed from my CME account. Now that I am leaving the job, the employer says they own the laptop and I must return it. I assert that I own the laptop, since I paid income tax on the money used to purchase it. Can you clarify if a material good (such as a tool, piece of equipment, or computer) is purchased by an employee and reimbursed from an accountable plan, does the employer or the employee own the equipment?
The true answer to your question is a legal matter subject to the terms of your employer’s accountable plan and your employment contract. Since I do not have those documents to review and am not authorized to give legal advice, I can only give general information. The typical process in this situation, unless the plan states otherwise, is that the item belongs to the employer since it is the party that paid for it. You state that you paid income tax on the item is not relevant and may not be accurate, since you were reimbursed through the accountable plan. Your employer approved the purchase and made you whole by repayment with money that was not reported as income and did not show on your W-2. If you keep the computer, it could be considered compensation, and you would then be taxed on the value. For further information on this matter, it would be best to contact an employment attorney.
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Answered by: Eric S. MacCollum, CPA, is a principal with Hudak and Company in Lemoyne, Pa.