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in his employment in computing adjusted gross income, provides,
in pertinent part:
the term “adjusted gross income” means * * * gross
income minus the following deductions:
* * * * * * *
(2) Certain trade and business deductions of
employees.--
(A) Reimbursed expenses of employees.–-
The deductions allowed by part VI (section
161 and following) which consist of expenses
paid or incurred by the taxpayer, in
connection with the performance by him of
services as an employee, under a
reimbursement or other expense allowance
arrangement with his employer.
However, pursuant to the regulations, if an employee is paid
under a reimbursement or expense allowance agreement and makes an
“adequate accounting” to the employer, then the employee is not
required to report the allowance in income. Sec. 1.274-5(e)(2),
Income Tax Regs; sec. 1.274-5T(f)(2), Temporary Income Tax Regs.,
50 Fed. Reg. 46028 (Nov. 6, 1985). An employee could meet the
adequate accounting requirement if the allowance is fully
substantiated by the employee to the employer. Sec. 1.274-
5(e)(4), Income Tax Regs.; sec. 1.274-5T(f)(4), Temporary Income
Tax Regs., 50 Fed. Reg. 46029 (Nov. 6, 1985). Alternatively,
the employee could meet the adequate accounting requirement if
the per diem allowance fell under either Rev. Rul. 80-62, 1980-1
C.B. 63, or Rev. Rul. 84-164, 1984-2 C.B. 63, because the
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