Some IRS executives appear to have incorrectly classified their travel as non-taxable, the Treasury Inspector General for Tax Administration has said.
It said the agency has established guidance and procedures to inform its senior executives and managers when overnight long-term travel reimbursements are subject to employment taxes. However, TIGTA said it reviewed the travel records of a sample of 31 executives and found that the tax classification of nine appeared to be incorrect based on their travel patterns and the IRS’s validation that the travel was taxable.
The IRS agreed to modify and document procedures for conducting periodic reviews to determine whether employees and managers accurately determine and report the taxability of long-term travel.