PA Schedule UE - Unreimbursed Business Expenses

Some workers may be able to deduct eligible work-related expenses from their state income tax. These resources can help you determine which expenses are deductible as an unreimbursed business expense. Keep in mind, state and federal rules differ.

Generally, expenses that may qualify for an itemized deduction include:

1. Travel and mileage
2. Certain mobile phone uses
3. Uniforms (required by the employer that are not suitable for street wear.)
4. Small tools
5. Office supplies
6. Professional license fees
7. Some moving expenses
8. Certain educational costs
9. Union dues, agency fees or initiation fees

Review the General Guidelines for Unreimbursed Expense Documentation for a complete list. The actual expense must be reported and cannot have been reimbursed

HOW TO REPORT / SUPPORTING DOCUMENTATION

You can claim a deduction for an unreimbursed employee business expense by filing a PA Schedule UE, Allowable Employee Business Expenses form along with your PA-40 Personal Income Tax Return. Review the instructions beginning on Page 25 of the PA-40IN to determine if you can deduct expenses from your PA-taxable compensation.

Forms, Instructions and Related Documents:

The following forms are available for download from the Personal Income Tax Forms webpage.

• PA-40
• PA-40IN – Instruction Booklet
• PA Schedule UE

Remember that you must keep records to prove the unreimbursed business expenses you deduct and provide the documentation when filing a PA Schedule UE.

Documentation Tips:

• If claiming expenses on PA Schedule UE, briefly describe your occupation or job in the space provided.
• File a separate PA Schedule UE for each W-2 that you receive or each employer and occupation for which you are claiming an unreimbursed expense.
• If your spouse also has expenses, describe his or her occupation or job on a separate PA Schedule UE.
• Tips for Successfully Filing PA Schedule UE (REV-489)
• General Guidelines for Unreimbursed Expense Documentation

Include the following with your PA Schedule UE:

• Detailed documentation for each line item (including copies and a summary page)
• A letter from your employer indicating that the expenditures were necessary and not reimbursed (REV-757 – Employer Letter Template).
• If an employer letter is not available, submit one of the following:
• A signed affidavit (REV-775 – Personal Income Tax Employee Business Expense Affidavit), or
• A copy of the employer’s employee expenses reimbursement policy

NOTE: The department may contact you to request a detailed breakdown of all expenses claimed, dated receipts and a letter from each employer.

IF YOU RECEIVE A NOTICE FROM THE DEPARTMENT ON YOUR UNREIMBURSED EXPENSES

If you have questions about a notice you received regarding unreimbursed business expenses, please refer to the corresponding answer on our online customer service center.

• Understanding Your 040 Notice
• Understanding Your 178 Notice
• Understanding Your 730 Letter
• Understanding Your 828 Notice
• Understanding Your 829 Notice

For additional filing tips, please refer to Tips for Successfully Filing PA Schedule UE (REV-489).