College Cellular Phone Plan Policy

Policy Background

The updating of University Expenditure Policies resulted in changes to the cellular phone policy. IRS tax rules require the substantiation of business purpose for each cellular call made. Without this substantiation, calls are deemed personal and represent a taxable benefit to the employee. The University provides three alternatives for the provision of cellular phones to employees as defined below in the policy.

Policy

University-Provided Cellular Phones

University-Provided Cellular Phones-Cellular phones may be provided through the University’s preferred provider of cellular telephone service through UNITS. University-provided cellular phones are intended for business use only. In accordance with IRS documentation requirements, departments must retain phone bills and be able to distinguish between business and personal use. Personal use of up to 10 minutes per month will be considered “de minimis” and will not require reimbursement. If an employee exceeds this threshold, the employee must reimburse the University for all of their personal use. Reimbursement to the University may be made monthly or quarterly according to policy. (See Policy for Personal Use of University-Provided Cellular Phones at http://www.ctlr.ohio-state.edu/webhelp/Financial_Policies.htm)

Taxable Allowance Option for Cellular Phones

To reduce the administrative burdens associated with tracking business and personal use of University-provided cellular phones, colleges and vice presidential units have the option of offering a taxable allowance for cellular phone service, similar to those provided under the Home Internet Connectivity Policy. Under this option, University payment or reimbursement for cellular phone service will be reported as taxable income on the employee’s W-2 form. No record keeping of business and personal use is required for central University purposes.

Processing of Taxable Allowances

If the allowance is to be paid directly to an employee, process additional pay through Human Resources, using the TXR earnings code.

If the University is paying the vendor for the cellular phone service, process the payment via 100W (for UNITS) or Accounts Payable (for external vendors) and record an adjustment to the employee’s taxable gross income in the HR system, using the TGI earnings code.

Reimbursement for Business Calls on Personal Cellular Phones

If the business use of a cellular telephone is infrequent, or if the personal use exceeds business use, the department should require the employee to provide his/her own cellular telephone and submit reimbursement requests for business calls. A copy of the cellular phone bill, detailing the individual calls to be reimbursed, must accompany the reimbursement request. The reimbursement amount is to be computed based on business use as a percentage of total use.

In all instances, use of the University Purchasing Card to pay for cellular phone service and equipment is prohibited.

College Procedures

Approval should be requested utilizing the Request for Payment of Cellular Phone Service/Allowance Form. Approval should be authorized by the appropriate individual as outlined in the College Internal Control Structure. Individuals must choose either the taxable allowance or the University-provided option for processing the request. A request should be processed annually prior to the start of a new fiscal year. The department is responsible for maintaining documentation for audit purposes.

The maximum cellular plan allowance for approved individuals is $75/month. An equipment reimbursement allowance up to a maximum of $150 for a standard cell phone and up to a maximum of $500 reimbursement for integrated wireless handheld devices for cellular service is also provided under this policy. (Exceptions must be pre-approved by the Dean.)

Individuals choosing the University-provided plan option will be asked to certify business use on a quarterly basis. Certification will include a review of the cell phone detail for the quarter, identification of any personal calls, and reimbursement of any personal calls exceeding those deemed “de minimus.”