Form 2106: Employee Business Expenses

AAA

DEFINITION of 'Form 2106: Employee Business Expenses'

A tax form distributed by the Internal Revenue Service (IRS) and used by taxpayers seeking to deduct expenses incurred while conducting business. In order for business expenses to be deducted, they must be considered ordinary and necessary. Ordinary expenses are commonly accepted in the industry; necessary expenses are those that are considered helpful and useful.

BREAKING DOWN 'Form 2106: Employee Business Expenses'

In order for an expense to be considered business-related, the taxpayer must furnish receipts indicating that the expenses were indeed incurred in order to conduct business. Travel expenses, including meals, entertainment and transportation, need to be represented in a receipt.

RELATED TERMS
  1. IRS Publication 535 - Business ...

    A document published by the Internal Revenue Service (IRS) that ...
  2. IRS Publication 463: Travel, Entertainment, ...

    A document published by the Internal Revenue Service that provides ...
  3. Transportation Expenses

    An expense incurred by an employee or self-employed taxpayer ...
  4. Tax Return

    1. The tax form or forms used to file income taxes with the Internal ...
  5. Internal Revenue Service - IRS

    A United States government agency that is responsible for the ...
  6. Travel Expenses

    The costs associated with traveling for the purpose of conducting ...
Related Articles
  1. Entrepreneurship

    10 Tax Benefits For The Self-Employed

    Running your own business has both personal and financial perks.
  2. Budgeting

    Drawbacks Of Travel Reward Programs

    These nearly universal loyalty programs can have handy perks, but they're not a free ride.
  3. Insurance

    Travel Tips For Keeping You And Your Money Safe

    Take precautions to avoid being taken advantage of on your vacation.
  4. Personal Finance

    Save On Planes, Trains And Automobiles

    Getting to, and around, your travel destination doesn't need to break the bank.
  5. Taxes

    5 Tax Credits You Shouldn't Miss

    If you're not taking advantage of these deductions, you could be missing out on tax savings.
  6. Taxes

    Tax Tips For Financial Advisors

    Self-employed advisors are prone to a number of unique expenses, but the tax benefits can often balance out the financial burdens.
  7. Taxes

    10 Most Overlooked Tax Deductions

    The receipts you cram into your wallet could be replaced with cash come tax season.
  8. Options & Futures

    Travel Smart By Planning How You'll Pay

    With a little pre-trip planning, you can avoid being stranded without adequate funds.
  9. Term

    What is a Preemptive Right?

    A preemptive right allows select shareholders to buy newly issued shares in their corporation before the general public.
  10. Investing Basics

    Understanding How Dividends Are Taxed

    Learn how dividends are taxed by the IRS, and understand the different types of dividend income as well as the capital gains tax rates.
RELATED FAQS
  1. How do you calculate penalties on an IRA or Roth IRA early withdrawal?

    With a few exceptions, early withdrawals from traditional or Roth IRAs generally incur a tax penalty equal to 10% of the ... Read Full Answer >>
  2. Are credit card rewards taxable?

    Credit card rewards are taxable in the United States some of the time. The Internal Revenue Service (IRS) classifies credit ... Read Full Answer >>
  3. How is market value determined in the real estate market?

    Anyone who has ever tried to purchase or sell a home has probably heard a lot about the property's fair market value, or ... Read Full Answer >>
  4. How do alimony and child support factor into my taxable income?

    The Internal Revenue Service, or IRS, applies a different tax treatment to alimony than child support. Most forms of alimony ... Read Full Answer >>
  5. What protections are in place for a whistleblower?

    Whistleblowers can play a critical role in ensuring the compliance, safety, honesty and legal fairness of governments and ... Read Full Answer >>
  6. How do I avoid a tax lien on my property?

    The best way to avoid a tax lien on your property is to make sure you pay all your state, municipal and federal taxes in ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Bubble Theory

    A school of thought that believes that the prices of assets can temporarily rise far above their true values and that these ...
  2. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  3. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  4. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  5. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
  6. Dead Cat Bounce

    A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!