Form 2106 - Employee Business Expenses

Federal Form 2106, Employee Business Expenses, is used by employees to deduct unreimbursed business expenses incurred as part of a job. This form is particularly relevant for employees who incur significant job-related expenses that are not covered by an employer.

Key Points:

• Unreimbursed Expenses: Form 2106 is used to report work-related expenses that are not reimbursed by an employer, such as travel, meals, lodging, and transportation.
• Qualified Expenses: These expenses must be ordinary and necessary for the job. This can include costs for maintaining a home office (if applicable), tools, professional dues, uniforms, and other job-related costs.
• Standard Mileage Rate: For employees who use personal vehicles for work-related travel, the standard mileage rate can be used to calculate deductible expenses.
• Limitations: Not all employees can use Form 2106. The Tax Cuts and Jobs Act of 2017 limited the ability to deduct employee business expenses for many employees, though some specific groups, such as armed forces reservists, qualified performing artists, and fee-basis government officials, may still qualify.

In summary, Federal Form 2106 is a useful tool for specific employees who need to deduct unreimbursed business expenses on tax returns. It helps in accurately reporting work-related costs that are necessary for a job.