SECTION 11. EFFECT ON OTHER

DOCUMENTS

Rev. Proc. 2001–54, 2001–48 I.R.B. 530, is hereby superseded for mileage allowances that are paid both (1) to an employee on or after January 1, 2003, and (2) with respect to transportation expenses paid or incurred by the employee on or after January 1, 2003. Rev. Proc. 2001–54 is also hereby superseded for purposes of computing the amount allowable as a deduction for transportation expenses paid or incurred on or after January 1, 2003.

DRAFTING INFORMATION

The principal author of this revenue procedure is Christian Wood of the Office of Associate Chief Counsel (Income Tax and Accounting). For further information regarding this revenue procedure, contact Mr. Wood at (202) 622–4930 (not a tollfree call).

ject to the 2-percent floor on miscellaneous itemized deductions provided in § 67.

.08 A self-employed individual may deduct an amount computed pursuant to section 5.01 of this revenue procedure in determining adjusted gross income under § 62(a)(1).

.09 If a payor’s reimbursement or other expense allowance arrangement evidences a pattern of abuse of the rules of § 62(c) and the regulations thereunder, all payments under the arrangement will be treated as made under a nonaccountable plan. Thus, such payments are included in the employee’s gross income, are reported as wages or other compensation on the employee’s Form W–2, and are subject to withholding and payment of employment taxes. See §§ 1.62– 2(c)(3), (c)(5), and (h)(2).