Cell Phone Allowance Withholding Exemption

This process must be conducted annually. To comply with IRS regulations,

1. Review your cell phone invoices for the two most recent months
2. Analyze each incoming and outgoing call, and document the amount and time of the call and the business purpose for the call (unless personal)
3. Determine the percentage of the calls that have a documented business purpose
4. Complete the Cell Phone Withholding Exemption Request Form

Submit copies of the two invoices, the Withholding Exemption Request Form, and your business purpose documentation to Purchasing Services. This percentage of calls with a documented business purpose will be applied to your monthly cell phone allowance to determine the portion of the allowance not subject to payroll withholding.

For example, if you determine from your two-month sample that 40% of your calls have a documented business purpose, and your monthly allowance is $30, the amount subject to payroll withholding is $18

If you do not conduct this process annually, 100% of your allowance will be subject to payroll withholding.

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