Taxing your clothing allowance?

[Nozlnut1330]

Does your town tax your clothing allowance? Ours did for the first time this year. We receive around $400.00 a year. They took out federal and state tax along with unemployment insurance....funny since we're volunteers and can't get laid off.

[voyager9]

My department doesn't take out taxes, but it does report it to the IRS (has to if you make over a certain amount). I have to account for it in April when I do my taxes.

All income is taxable. It matters not the source. If your employer doesn't automatically take out taxes, then it will be taken out at the end of the year. There are ways to balance things out so that you don't get taxed, a good accountant should be able to walk you through it.

[DTLarson]

In the short run, it is taxable, but save the receipts and you will be able to write it off in April. My tax guy loves volunteer firefighters and EMS because he can write off many things.

[FWDbuff]

So do what I do and claim it.

-Claim your uniforms.
-Claim any magazine subscriptions (Firehouse, Fire Engineering, etc..)
-Claim small tools (Flashlights, Gerber tools, etc.) anything your dept does not issue
-Claim any costs not re-imbursed by your organization for training, certifications, etc.
-Claim your cell phone bill
-Any mileage incurred on your personal vehicle for training, etc.

[DeputyChiefGonzo]

If you are paid cash for your clothing /uniform allowance, then yes, it can be taxed.

Ours is an account. if we purchase from an approved vendor, they just charge our accounts.

If we buy omething that is job realted but not from a vendoe, we hand in the recipt and the City cuts us a check out of the account.

We get $875 a year for uniforms. The City provides all PPE. If we want a lleather lid, the City will pay the amount they would for a pleather one if they are replacing it. The same for leather boots.

[Dalmatian190]

Yeah, it's taxable income when it's just "here's $400."

In order for it to not be taxable it would have to be tied to something like mileage, hours worked, or calls attended...such as X calls @ Y rate. (And still meet some requirements for being a nominal amount intended to reimburse for expenses so you don't run afoul of the Fair Labor Standards Act).

The business world uses that for mileage & per-diem M&IE (Meals and Incidental Expenses) reimbursements so they don't have to collect all the small receipts. The key requirement is each payment has to be tracked to a specific event - a mile driven, a day spent away on business travel.

In the case of simply giving an annual lump sum, since it's not event-driven (we expect each person to occur, on average, $4/call in expenses so we pay them $4 x calls attended) and it's not actual expense driven (here's the receipts for my new clothes...) it's not considered a reimbursement but instead taxable income.