What was Form 2106-EZ: Unreimbursed Employee Business Expenses?
Form 2106-EZ, issued by the IRS, allows employees to deduct required and customary costs linked to their jobs.
The Tax Cuts and Jobs Act (TCJA) discontinued most deductions for unreimbursed employee expenditures for most taxpayers. After 2017, Form 2106-EZ: Unreimbursed Employee Business Expenses was no longer available.
Form 2106 is still available to a few groups who qualify for deductions, but 2106-EZ is no longer used. These include military reservists, performers, fee-based state and municipal government officials, and disabled workers.
Who Can File Form 2106-EZ: Unreimbursed Employee Business Expenses?
Standard and accepted company expenses were called ordinary expenses. Business expenses are necessary.
Employees seek tax deductions for unreimbursed expenses related to their jobs using Form 2106-EZ, a simplified version of Form 2106.
Employee deductions are only allowed if the company does not repay the expense. This form lets employees claim the regular mileage rate for automobile expenses.
The Tax Cuts and Jobs Act eliminated unpaid employee expenditures. People used Form 2106-EZ: Unreimbursed Employee Business Expenses until 2017.
Filing Form 2106-EZ: Unreimbursed Employee Business Expenses
The form included two sections. We tallied employee business expenses in Part I and determined tax deduction eligibility. Part II focused on automobile costs.
Employees had to list unreimbursed business expenses such as flights, hotels, parking, tolls, and car rentals in Part I and personal vehicle expenses in Part II. Deducted incidental costs included valet tips and other modest monetary transactions without receipts. Taxpayers could only claim 50% of meals and entertainment, so they retained these separately.
You can calculate overnight expenses using GSA per diem rates for U.S. cities or State Department rates for international travel. Based on local availability and demand, lodging rates fluctuate considerably each month. In Aspen, Colorado, the GSA allows a per diem accommodation cost of $361 in January 2020 but $185 in September. Aspen had a 2020 per-diem meal rate of $76.
Vehicle Costs Are Still Deductible
The regular mileage rate applies to personal vehicle expenses, as Part II discusses. This required multiplying the tax-year IRS mileage rate by business-qualifying miles driven. The mileage rate includes gas, repairs, and regular car wear.
The tax rules still let self-employed people deduct work-related vehicle use. The 2020 tax rate was 57.5 cents per mile. It declined to 56 cents in 2021.7
Taxpayers can still deduct charitable and medical vehicle costs. Only active military personnel can remove personal car use for employment relocation.
Download Form 2106-EZ
Download Form 2106 from the IRS website.
Form 2106-EZ is available but inactive.
- Employees deducted meals, motels, flights, and automobile expenses using Form 2106-EZ.
- After 2018, the Tax Cuts and Jobs Act eliminated unreimbursed employee cost deductions, eliminating this form.
- The whole Form 2106 is available; however, only certain taxpayers can deduct.