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5 Unreimbursed Work-Related Employee Expenses and What to Do About Them

By Matt Breed

office partyWhen you freelance or own a business, the responsibility for managing and reducing expenses is yours alone. Therefore, you often have a plan for even the most unlikely ones.

If you are employed by someone else, however, you might assume that they have any unexpected expenses covered. Unfortunately, this isn’t always the case. There will be times when you have to use your own money to pay surprise, job-related costs.

As with everything, a little preparation goes a long way. Take a look at this list of five unexpected expenses and avoid being caught unaware.

Surprise Work-Related Expenses

1. Travel

You may wonder why travel expenses would come as a surprise since, in many positions, they are just part of the job. Often, along with those expected expenses, there is an expectation of reimbursement. While most employers are willing to take care of travel-related expenses such as the cost of gas, tolls, mileage, and even vehicle wear and tear, some are not able or willing to be so generous.

What to do:
If your employer fully expects you to pay for some or all of your own travel expenses, it can hit your budget hard. Here are two things you can do to help soften the financial blow:

  • Approach your boss or manager. Even if your employer hasn’t even hinted at offering to pay, ask for the travel-related expenses (within reason). You are probably not going to get everything, but it’s worth a shot – even if you are deathly scared of your boss. What’s the worst thing that could happen? They say no, big deal.
  • Save your receipts. As long as you are not eligible to get your expenses reimbursed at work, you can deduct them on your taxes. Just be sure to keep that pile of receipts in a safe place. Documentation is key when it comes to getting the most out of these tax deductions for job-related expenses.

2. Clothing

In this day and age, the majority of offices have business casual or casual dress codes. Because of this, many people have little to no formal business wear. Occasionally, events may arise that require you to purchase more professional attire.

Whether it’s for a charity event, volunteer work, or a visit from the corporate office, if you’re expected to kick it up a notch wardrobe wise, the expense will most likely fall completely on you. For those employees who are barely scraping by, having to spend money on clothes you may only wear once is a tough pill to swallow.

What to do:
As with travel expenses, clothing costs can also be tax deductible (with limitations). That would be great news, if you had the cash on hand to pay for them. Try these tips to help you fund the right look:

  • Consider the event. Depending on what the event is, you may be able to talk to your employer about reimbursing some of the cost. If it’s something that’s company-wide, like a visit from corporate, this may not work. But, if you are being asked to represent the company at a conference, or pose for photos featured on the company website, they may be willing to work with you.
  • Think second hand. When reimbursement is not an option, and you simply don’t have the cash on hand, check Goodwill or other thrift stores. Consignment shops specifically focused on brand name clothes are a hot trend right now. A quick online search will let you know of any options in your area. While you will not get the clothes for free, it can greatly ease the burden of this unexpected purchase.

3. Job Search Costs

Whether you’re currently employed and looking for the next big thing, or unemployed and in need of any job at all, costs related to the job hunt can get steep. You may have to travel multiple times for interviews, hire a headhunter, or hire a professional to clean up the mistakes on your resume.

What to do:
When you start your search, consider taking a few steps to keep from being blindsided by cost:

  • Check out local resources. Obviously, if you are currently unemployed, the likelihood of having cash on hand to fund your search is pretty slim. Career centers offer free seminars and assistance that can be highly valuable to your search.
  • Moving within the company. You can’t expect your current employer to help with expenses related to finding a new gig. But, if you are looking to move within your own company or even get a raise, there may be assistance available. Talk to your employer about your career goals to see if they’d be willing to help.
  • Set up a fund. If you are a victim of layoffs, this is probably not something you’ll have the time to do. However, if you are currently employed and foresee change ahead, start saving some money away to fund your search now. Don’t be surprised if your search costs you a few hundred dollars. Just make sure the new job you accept is worth your while.
  • Tax deductions. Some expenses related to the job search are tax deductible (do you see a trend forming here?). Many people try to take advantage by “pushing the limits” of what is actually deductible by law, so make sure that what you are deducting is actually eligible.

4. Meals and Entertainment

Perhaps the most costly of these work-related expenses is entertainment, which can manifest itself in many ways. It could be the potluck lunch at the office that you are asked to make a dish for, or entertaining clients at an expensive restaurant. If you are instructed to take clients “out on the town,” you might be expected to foot the bill for a round of golf or purchase tickets to a concert or sporting event.

What to do:
If these types of expenses crop up regularly and are draining your wallet, try the following:

  • Crock pots and casseroles. When asked to provide a dish for that fun work potluck, put your budget-friendly cooking skills to work. Crock pot recipes are inexpensive, delicious, and feed a crowd without a problem.
  • Speak up. If this is the fifth pot luck in a month and you simply can’t afford to bring a dish, let the organizer know. Nobody will hold it against you. Offer to help with set up or dishes in place of providing food.
  • Talk to accounting. When it comes to other entertainment expenses, the best course of action is to get your money up front. Let your accounting department, or management (whoever is in charge of expenses) know that you do not have the money to properly entertain the client. They will most likely have no problem setting you up with proper funding. After all, they should want to do what is best for the client. Just remember to hold on to each and every receipt in order to justify the money you spent.

5. Gifts

Coworkers’ promotions, birthdays, marriages, baby showers, and many other circumstances, warrant gifts. Being generous feels great, but these celebratory events can pile up quickly and have an adverse effect on your wallet.

What to do:
Gift giving is not nearly as touchy a subject as many people think. Personally, I would never expect a gift from someone who is strapped financially. That said, a token of acknowledgement is always appreciated. From baked goods to a simple offer to lend a hand, there are literally thousands of ideas for inexpensive, or completely free, gifts that are thoughtful and will be well received. You could even recycle unwanted gifts by following proper regifting etiquette.

Final Word

In a perfect world, everyone would have some money stashed away for all of life’s little surprises. Since that is not likely to happen anytime soon, plan ahead as much as you can, consider your options when things do come up, and figure out what will work for you.

Remember, you are your own best advocate. Never assume your employer won’t work with you. If you take the time to ask, you might be pleasantly surprised.

What sort of unplanned work expenses have you run into? How did you handle them?

(photo credit: Shutterstock)

Matt Breed
You are looking at Matthew Breed. He is a 30 year old sports nerd who lives in North Florida with his fiancee, Sarah. Originally in school for a Business degree that did not work out due to capricious youth and irresponsibility, he is currently "getting past" his Peter Pan syndrome and attends classes for a degree in Information Technology while working full time. His care for personal finance stems from a modest upbringing with fiscally responsible parents who highly value education and frown upon frivolity.

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Comments

  • Avnet

    Unreimbursed Employee Expenses are a red flag to the IRS.

    • steve

      i have reimbursement from my employer for mileage but they dont report it on my W@. Why is that? i travel almost 28 k a year. they pay mileage not gas or depreciation or actual costs.

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