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do the fuel expenses have to be paid by a business credit card? What if they have been paid out of my personal bank account? Can I still claim them as a deduction?

2007-03-07 06:27:07 · 4 answers · asked by M 2 in Business & Finance Taxes United States

I'm talking about on my personal income taxes - where I list my expenses such as meals entertainment and fuel. Not the business taxes.

2007-03-07 06:45:14 · update #1

4 answers

Unless you are an employee of the corporation, you need to complete Form 8082 to claim S Corp items which are different than your K1. The form is an obvious red flag addition to your return, so make sure that everything is absolutely straight and aboveboard. You should work out your expenses with the corporation so that you don't have any K1 inconsistencies. If you are an employee of the corporation, then you need to complete Form 2106, which isn't quite so much of a red flag.

2007-03-14 18:46:20 · answer #1 · answered by Scott K 7 · 0 0

They should have been paid with a business credit card. If you were not reimbursed, you can claim your expenses as miscellaneous itemized deduction (Sch. A) subject to 2% of your AGI. You may not get any tax benefit from this, however.

In the future you should submit an expense report to the S Corp. You should be reimbursed for your expenses, and the business would take the deduction for the expense. It would then be included in your K-1.

2007-03-07 06:36:38 · answer #2 · answered by tma 6 · 0 0

I think that if you use the fuel expense on your own taxes, then I think you can legally claim this as a business expense (like moving costs, mileage, etc.). I do not know this for sure, but I do not think that the business being an S corporation would have anything to do with your personal finances. There are many people who buy things for business, and do not have a credti card. You do, however, need receipts.

2007-03-14 15:59:03 · answer #3 · answered by kmf77 3 · 0 0

You should never comingle funds. The corp can deduct the expense IF it reimburses you for it. Make sure that you and the corp have complete, accurate records to substantiate the expenses. If the corp doesn't reimburse you, it cannot expense the item.

2007-03-07 06:36:48 · answer #4 · answered by Bostonian In MO 7 · 0 0

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