Announcements
Stay informed with daily university tax updates, regulatory news, and compliance alerts designed to support accuracy, accountability, and informed decision-making across campus.
Tax Law & Enforcement Update
Updates on emerging laws, regulatory requirements, and enforcement trends that may influence universities, academic institutions, and campus operations.
- The threshold for forms 1099s increased to $2,000 for certain payments: IRS Website
- For tax years beginning after 2025, the minimum threshold amount for reporting certain payments required to be reported on certain information returns and/or perform backup withholding on those payments increased to $2,000 and will be adjusted for inflation beginning in calendar year 2027.
- Please note that, depending on applicable treaty provisions, there is no reporting or withholding threshold for payments made to nonresident aliens.
- IRS Section 127 educational assistance programs FAQs: IRS Website
Policies and Procedures Updates
Please see the Tax Department's latest information on newly issued or recently updated policies and procedures.
- Late Expense Reimbursement for Out of Pocket Expenses FAQs - FAQs
- Tech Tool Policy (Cell Phones) - Tax Policy
- Local Lodging Policy - Tax Policy (New)
- Interview Travel Reimbursement Policy - Tax Policy (New)
- Gifts, Prizes and Awards to Employees - Revision (Updated)
Excise Tax Template - Template (New)
Tax Alerts
Tax Tickets – As part of the audit process, our office reviews certain expense reimbursement requests submitted through Emburse Enterprise to determine whether taxation is triggered. If so, the schools, colleges and units (SCU) must submit the reimbursement through the Payroll office to include as taxable income in the employee’s wages. Please know that the SCU may gross-up the reimbursed amounts to cover the employee's taxes. After reviewing the tax tickets over the past year, below are helpful reminders.
- Lateness - SPG 507.10-1 on Travel and Business Hosting Expense Policy states "to be eligible for tax-free reimbursements, employees must ensure that they submit their out-of-pocket expenses completely and accurately, including corrections and approvals, in the university’s expense reporting system within 60 calendar days from the date of the transaction, the end date of the trip, or the date of event in accordance with federal treasury regulations." Late submissions and late approvals will be reviewed by the Tax department to determine whether they are eligible for tax free reimbursement. Please see the Late Reimbursement FAQs for additional information.
- Apparel – The reimbursement of clothing that an employee is required to wear when performing one’s duties may trigger taxable income when the clothing is suitable for general wear or use away from work. Please contact our office if you have questions. This issue has been included in recent employment tax audits conducted by the Internal Revenue Service (IRS).
Employee Retention Credits (ERC) – The ERC is a federal subsidy for employers that had to continue to pay wages for their employees who were sent home and not able to work due to the pandemic. This credit was most helpful to businesses during the 2nd and 3rd quarter of 2020. SCUs are receiving notices from firms that appear as refund statements from the IRS, reminding businesses that they should file for the ERC if they have not done so. Please send these notices to our office.
- U-M as a government entity was not entitled to benefit from this credit until calendar year end (CYE) 2021. Based on our discussion with an outside counsel, it was determined that the opportunity had passed by, i.e., U-M had repurposed its idle employees to effective employment positions by CYE 2021.
- The IRS has issued multiple warnings regarding fraud alerts from overaggressive firms who are filing these claims.
Need assistance
Please do not hesitate to reach out to the tax team if you have questions or concerns via email. Our goal is to ensure you are fully informed. Feel free to reach out to us here.