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PA Schedule UE
Line 1B - Unreimbursed Employee Business Expenses - Long Form

What Unreimbursed Employee Business Expenses Does Pennsylvania Allow?

Allowable employee business expenses for PA purposes are similar, but not exactly the same, as expenses for federal purposes. An allowable PA employee business expense must be:

If your employer does not reimburse you, you may reduce your compensation by your allowable expenses.

Note: The Department has the legal authority to require evidence that the expenses you claim on a PA Schedule UE are allowable for PA purposes. The Department may ask that you substantiate the amount and nature of your business expenses. Keep your necessary documents, receipts, vouchers, and other records for at least four years. You must be able to prove that your expenses are ordinary, actual, reasonable, and necessary.

You did not incur an allowable business expense during the year if you:

If your reimbursement is more than your allowable expenses, you must report the excess as taxable compensation on Line 1a.

Sole proprietors, partners, shareholders, or other self-employed individuals do not use PA Schedule UE to claim expenses.

Nonresidents who earn compensation and incur allowable employee business expenses both within and outside Pennsylvania may need to complete and file a PA Schedule NRH, which is not allowable on padirectfile.

Pennsylvania does not allow the following expenses, even if allowed for federal purposes:

General Instructions

For detailed information, if you have a job or a profession in which you perform the same services, but receive Forms W-2 from more than one employer, review PA PIT GUIDE.

Part A -- Direct Employee Expenses
You pay these expenses directly or through a withholding arrangement with your employer. These expenses are necessary to perform or maintain your job.

Union Dues
Union dues, assessments, and initiation fees are allowable business expenses if:

Work Clothes and Uniforms
The costs of purchasing and maintaining uniforms and work clothing to protect you from bodily injury are allowable business expenses if the uniforms and clothing are both:

Small Tools and Supplies
Expenditures for small tools and supplies that are needed for your employment and not provided by your employer.

Professional License Fees, Malpractice Insurance, and Fidelity Bond Premiums Trade, you can include professional, or occupational licenses or fees that are required as a condition of employment are allowable business expenses. Include malpractice insurance and fidelity bond premiums where required by law or by your employer.

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