14.13 Meal Reimbursement

Policy Information

Policy Number: 14.13	Effective Date: 07/11/12
Responsible Unit: FSO Operations - Travel	Last Revised Date: 10/01/2018
Email:  fso_travel_pay@fso.arizona.edu	Phone: 520-621-9097

Purpose and Summary

To provide policy and procedures on meal expenses and reimbursements.

Source

State of Arizona Travel Policy
Internal Revenue Service

Scope

This policy applies to all University locations and units, including all University extensions, satellite locations, and off-site campus units, both domestic and international.  

Definitions

1. Meal Reimbursement: A specific amount of money limited to University of Arizona travelers to cover meals and incidentals while traveling on University business.  The rates are established by the State of Arizona and designated to reduce the administrative burden on travelers to eliminate collecting receipts per meal.  These rates are not designed to cover the entire cost of the meal, but to cover the difference between the costs of a meal of which the traveler might otherwise partake when not traveling for the University.
2. Duty Post: The primary place of business in which the individual reports to work on a daily basis.
3. Primary Destination: Travel may include multiple destinations. However, meal reimbursement is determined by the lodging location at which the employee will spend the night at the end of a travel day. Meal Reimbursements on the day of return are based on the rate for the location at which the traveler stayed the previous night.
4. Accountable Plan: The University of Arizona reimburses employees under the IRS Accountable Plan in which expenses must have a business purpose, be adequately documented and submitted within a reasonable period of time.
5. Long Term Travel: Temporary assignment to a duty post, in excess of thirty-five (35) miles from the individual’s residence and/or primary duty post for periods greater than thirty (30) days but less than 365 days.

Policy

General

1. University business travel status is determined when a traveler is required to be more than thirty-five (35) miles from the traveler’s residence and/or primary duty post.
2. Meal reimbursement rates are determined by the traveler’s primary destination, established by the State of Arizona Accounting Manual for travel within the continental United States. For travel through September 30, 2018 see State of Arizona Accounting Manual established meal reimbursement rates.
3. Meal reimbursement rates for travel outside the continental United States are established by the United States Department of State Foreign meals/lodging.
4. Meal reimbursement rates for travel to Alaska, Hawaii, and the US Territories are established by the Defense Travel Management Office by adding the Local Meals rates to the Local Incidental rate.
5. A full-day meal reimbursement rate should be reduced for a meal(s) provided to the traveler by another entity.
6. When a traveler is reimbursed for actual costs of meals in accordance with these rules, reimbursement cannot exceed the meal reimbursement rate. If the traveler is reimbursed for actual costs at the department discretion, original itemized receipts for meals must be provided.
7. Tips paid in connection with a meal are considered part of the cost of the meal.
8. Tips that exceed industry standards will not be reimbursed. The U.S. industry standard is between fifteen percent (15%) and twenty percent (20%) of the total bill.
9. Reimbursement for the purchase of alcoholic beverages, including tax and tip, related to the purchase are prohibited with University funds. 
10. Meal reimbursements for domestic cities and counties not listed in the State of Arizona Accounting Manual are limited to $45 per-day regardless of location.
11. Travelers requesting reimbursement for meals exceeding 90-days from the end of the travel event will be reimbursed as a Non-Qualified reimbursement and receive notification of taxable income under the University of Arizona 14.12 Accountable Plan.

Meals Involving an Overnight Stay

12. On the day of departure and the day of return, the traveler is entitled to seventy-five percent (75%) of the full-day meal reimbursement rate based on the traveler’s destination regardless of the time the traveler departed or returned.
13. Travel days involving an overnight stay, that are not the day of departure nor day of return, may be reimbursed for the Full-Day Meal reimbursement rate for the applicable date and location.
14. Reimbursement for meals involving an overnight stay are considered a qualified reimbursement and not taxable to the traveler, unless they do not meet the IRS Accountable Plan and the request for reimbursement exceeds 90-days from the end of travel status.
15. Traveler may not claim reimbursement for more than the full-day reimbursement rate in a single calendar day or twenty-four (24) consecutive hours.

Travel NOT Involving an Overnight Stay

16. Traveler qualifies for a single day meal reimbursement limit of $12, if their travel exceeds six (6) hours or more but fewer than twelve (12) consecutive hours.
17. Traveler qualifies for an extended day meal reimbursement limit of $19, if in travel status twelve (12) or more consecutive hours.
18. Single and extended day meal reimbursements limits apply regardless of destination and time of day the meals are purchased/consumed.
19. Meals reimbursed to a traveler without an overnight stay are taxable income to the traveler and will be reported on the employees W-2.

Long Term Travel

20. When on long term travel status, regular meal reimbursement rates do not apply.  Long term travel status applies to sabbatical leave but is not necessarily restricted to only sabbatical leave.
21. If the employee will be away from their duty post for more than 365 days this is not considered travel status. Once the traveler knows the duration will be greater than 365 days it becomes a relocation and is not considered University travel reimbursable under this policy. Refer to Policy 9.14 Relocation Policy for Employees for policy on relocation expenses.
22. Long Term travel status must be authorized by the department head with a letter of explanation detailing the lodging arrangements, requested/approved meal reimbursement and other pertinent information. The following guidelines apply:
    1. Travelers are allowed regular lodging and meal reimbursement rates for the appropriate season, not to exceed seven (7) days, while arranging for long term assignment if arrangements for accommodations were unable to be made prior to traveling.
    2. After the initial seven (7) day period, meals and lodging will be reimbursed as follows:
       1. Meal reimbursements will be made at the rate of fifty (50%) percent of the full-day amount allowed for the designated location.   
       2. Lodging will be reimbursed at the rate of twenty-five (25%) percent of the amount allowed for the destination. Lodging reimbursement includes all related costs such as electricity, gas, water and telephone. 
    3. Maximum reimbursable amounts must be determined in advance by the department, on a case by case basis. 
    4. If the traveler returns temporarily to his/her residence or primary duty post during the long term travel status, meal reimbursement will be reimbursed according to the meal reimbursement destination rate, if eligible. Mileage is not reimbursable if the traveler returns to his or her residence during long term subsistence travel. 
    5. Reimbursement associated with long term travel status in excess of one-year is taxable income to the employee and will be reported on the employee's W-2 form.
23. Sponsored Project Grant and Contract accounts: If the grant or contract provides specific meal reimbursement or per diem rates for foreign or domestic travel, these rates will be honored but must be supported by a copy of the relevant page of the grant or contract.

Procedures

1. A Travel Expense Report (TER) should be completed, claiming meal reimbursement costs to include a breakdown of daily expenses. Full-day reimbursement may be shown on the report in a daily lump sum amount.  Meals provided by a sponsor/host should be identified on the TER and removed from the meal reimbursement requested amount, as they represent no cost to the traveler. 
2. Full day, single day, and extended day meal reimbursements are to be reduced when a meal is provided by the host or sponsor, including business meetings/entertainment meals, depending on the meal provided as follows:
   1. Meal provided between 12:01 a.m. and 10:00 a.m. is deemed to be breakfast and the amount allowed in the destination location for breakfast should be deducted.
   2. Meals provided between 10:01 a.m. and 2:00 pm is deemed as lunch and amount allowed in destination should be deducted.
   3. Meals provided between 2:01 p.m. and 12:00 midnight is deemed to be dinner and the amount allowed by destination for the day should be deducted.
3. Meal receipts should be reviewed for tips exceeding industry standards (between fifteen (15%) – twenty (20%) percent of the total bill).  Tips exceeding the industry standards should be recalculated and the reimbursement reduced accordingly.   
4. A receipt containing alcohol, tip and tax should be recalculated using the Receipt ReCalculator and the adjustment should be clearly documented for reimbursement. 
5. International meal reimbursement rates should be calculated from the US Department of State utilizing the final destination country in which the traveler will be lodging and conducting University business.  When the travel event consists of multiple destinations, the reimbursement will include multiple meal reimbursement rates to coincide with each destination, dependent on lodging location. 
6. Receipts for meals in foreign currency require US Dollar currency conversion as reimbursement will be provided in US Dollars.  Best practice is to utilize an on-line currency converter such as Oanda and document the conversion amount on each invoice and/or receipt.  Use the receipt date to ensure the correct conversion is obtained for the traveler.
7. A Disbursement Voucher should be initiated in UAccess Financials for reimbursement of meals and other related travel expenses. A copy of the completed Travel Expense Report (TER) along with any supporting documentation (except security sensitive information) should be attached in the Notes/Attachment Tab of the Disbursement Voucher. 
8. The original signed Travel Expense Report (TER), Disbursement Voucher Cover Sheet and any original itemized receipts, if applicable, along with any additional supporting documentation to substantiate the travel event should be submitted to FSO Accounts Payable.
9. Taxable reimbursements for meal reimbursements without an overnight stay will be processed by Accounts Payable and the employee will receive an email notification regarding the taxability.
10. Questions regarding the reimbursement process should be directed to FSO Accounts Payable Travel Office at 520-621-9097 or fso_travel_pay@fso.arizona.edu
11. Questions regarding travel funding sources should be directed to the departmental FSO Fund Accountant or to Sponsored Projects & Contracting Services (SPCS) for SPCS accounts.

Frequently Asked Questions

Should the business office provide the traveler with the breakdown of breakfast, lunch and dinner to provide guidance on what they may expense for the day per meal?

Yes, when a traveler is entitled to a full day reimbursement, the amount expended for any particular meal is left to the discretion of the individual, but the total for all meals in one day shall not exceed the maximum reimbursement limit. It is a best practice to ensure travelers are aware of meal reimbursement amounts for the destination of travel. Additionally, it is recommended that a Travel Tips and Receipts Envelope be provided to the traveler describing meal reimbursements and incidental expenses.

Is a snack/peanuts provided on an airplane considered a meal?

No, a light snack consisting of peanuts, cookies, candies, coffee, tea, soft drinks, ice cream or similar refreshments provided by a host does not constitute a meal.

Is a continental breakfast served at a conference or by the lodging establishment considered a meal?

Yes, a continental breakfast served at no cost to the traveler constitutes a meal whether or not it contains protein and no reimbursement for the breakfast will be allowed.  

Am I required to submit meal receipts when claiming meal reimbursement?

No, receipts are not required when claiming meal reimbursement.  However, an original itemized receipt is required for a business meeting expense in which, the employee paid on behalf of other individual(s).  For a business meeting with University business purpose, meal reimbursement rates would not be utilized and actual costs reimbursed.

How should I calculate meal reimbursements on departure and return days of travel?

University travelers are allowed 75% of the full day meal and incidental (M&IE) rate regardless of departure or return time based on the rate determined by the destination of the traveler. 

How should I calculate meal reimbursement when a meal was provided at a conference?

Meals provided while attending a conference or on travel days must be subtracted from the traveler’s full-day meal reimbursement.

Scenario 1:
Traveler departs to San Diego, CA (M&IE = $61) on Monday for a two-day conference and no meals are provided at the conference or on travel days, Traveler returns to Tucson on Thursday late afternoon. 

Scenario 2:
Traveler departs to Boston, MA (M&IE = $61) on Tuesday for a two-day conference and a networking dinner provided on the day of arrival.  Breakfast and lunch are provided during the conference and breakfast is provided on day of return on Friday. 

How do I determine the value of meals provided for Alaska, Hawaii and out-of-country locations or if the location is not listed in the index tables?

Apply the following percentages to the full-day meal reimbursement rate to obtain the value of the meal:

Breakfast          20%
Lunch               25%
Dinner              55% 

When a location is not listed in the rate index tables, the rate designated as 'Other' should be utilized.

If I am unable to locate a specific rate for a domestic city destination, what rate should I use?

When neither the specific city nor county is listed, use the default rate indicated at the beginning of the reimbursement rate table.

When on travel status and the host is providing meals that do not meet my dietary requirements, what should I do? 

The traveler should make any necessary arrangements to accommodate dietary requirements to ensure a healthy travel day. If the host or conference is providing a meal that does not meet the traveler’s dietary requirements the traveler may receive the full meal reimbursement rate for that meal. When submitting reimbursement, provide a business justification on the Travel Expense Report, Disbursement Voucher or supporting documentation, to indicate dietary requirements were not met by the host. 

What should I do if the receipt contains expenses to be paid through another entity?

The receipt should be recalculated and clearly documented as to what is the University’s portion of the expenditures and the other entity’s portion.  A copy of the receipt containing expenses that will be covered by another entity should be provided to the other entity and the original should be forwarded with the request for reimbursement to FSO-Operations. 

What should I do when a meal reimbursement contains a business meeting expense?

When conducting business meetings while on travel status, please refer to 9.10 Requisitions/Reimbursement policy for the required documentation.  In addition, the meal reimbursement for the day of the business meeting should reduce the full-day, single day or extended day reimbursement rate and be documented on the Travel Expense Report. 

May a traveler utilizing non-commercial lodging for University business receive meal reimbursement(s)?  

Yes, a traveler may receive meal reimbursements for costs incurred by the traveler. Full-day meal reimbursements should be reduced when a meal was provided by another entity such as: conference sponsor, airline, continental breakfast, friend, family or other entity.

How do I calculate international travel day meal reimbursement when the travel takes two days?

To calculate meal reimbursement for international travel, the first departure day is calculated at 75% of the destination rate and the following arrival day is calculated at 100%. On the return trip, the departure day is calculated at 100% of the destination rate and the following arrival day is calculated at 75%.  Meals provided in transit or upon arrival should be deducted from the meal reimbursement rate at the full value of the meal.  

Related Information

Travel Training - UAccess Learning
State of Arizona Accounting Manual - Reimbursement Rates - Effective 10/01/2018
State of Arizona Accounting Manual - Reimbursement Rates - Travel through 09/30/2018
Defense Travel Management Office (Reimbursement rates for Alaska and Hawaii)
International Travel Reimbursement rates
University of Arizona Sabbatical Leave Policy
IRS Publication 463, Travel, Entertainment, Gift, and Car Expenses
14.71 Meals/Lodging Cost Index

* Please note that sections titled Frequently Asked Questions and Related Information are provided solely for the convenience of users and are not part of the official University policy.