I am trying to figure my taxes out. Fore example, if I am being reimbursed up to 4.75 for alcohol compliance shop and I buy a bottle of alchohol that is over 4.75 can I claim the full amount. Of course, there was alchohol that was under 4.75. Or what if I buy a cheap bottle of wine and a snack that makes my total over 4.75?

you can deduct the portion you weren't reimbursed on...as long as its reasonable.

You can't buy a 300 dollar bottle of wine and deduct that...but a 10 or 20 dollar
bottle is ok to deduct the unreimbursed portion...

And the snack over 4.75 is not deductible as part of that expense...

but could be deducted as part of meal expenses under certain
circumstances...



Edited 1 time(s). Last edit at 06/30/2013 04:18PM by techman01.

If you could have bought the wine that would have been fully reimbursed, then no, you cannot claim the amount over 4.75. If buying a snack was not a requirement and you bought one anyway, then that is not reimbursed either, even though the wine would be below 4.75.

Karen IL Wrote:
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> If you could have bought the wine that would have
> been fully reimbursed, then no, you cannot claim
> the amount over 4.75. If buying a snack was not a
> requirement and you bought one anyway, then that
> is not reimbursed either, even though the wine
> would be below 4.75.


i asked many years ago and as long it is reasonable they
said it is ok...

While I have heard that a "reasonable" amount over could be deducted, my goal is to keep it simple and avoid any unwanted scrutiny.

I would think the circumstances would come into play if you were audited. For example, the Sonic shop I do gives me a choice of certain things we are allowed to get. The one I choose ends up about 50 cents over the reimbursement. I claim the full amount I paid, because there is no reasonable way to be sure to stay within reimbursement due to variables such as price increases and taxes and the need for confidentiality that would stop us from saying "Wait, I can't go over $5.80, let me pick something else" when they tell you the total.

But if the job requires you to make a purchase, and you know you are only going to be reimbursed $4.75, and could have stayed under $4.75 but chose to go over for personal preference reasons, and you knowingly go over because you want a more expensive item why would the IRS allow deduction of the full price? That's not reasonable at all. (I'm not talking about ending up $5.25 with the tax, I'm talking about buying a $10 bottle because you prefer that brand, or wanted a bigger quantity.)

I did an Ace Hardware shop, $5 reimbursement, and bought a $20 bottle of weed killer I needed. I deducted $5 for the "required purchase" but I sure wouldn't think of deducting the other $15 off my taxes. Even when I spent $6 because I bought the required item for $3 and added an impulse item at the register, they reimbursed me $5 but I wouldn't think of claiming the other dollar as a deduction. If it wasn't necessary to go over, then it's not a deduction. (I was surprised they gave me the $5 instead of just reimbursing the "required" item.)

In other scenarios, you are required to make a purchase for a $2 reimbursement but there is nothing you can find for under $2 so you make a $4 purchase. Certainly deduct the whole $4. You were required to make a purchase and couldn't make one within the reimbursement. The $4 became a necessary purchase.

The best thing to do, unless you were FORCED to go over because there was nothing under the limit or the designated purchase (pick one of these entrees) put you over, is to just deduct the $4.75 you were allowed, and consider it a discount on something you wanted to buy anyway. After deducting the full allowable mileage deduction, you're not likely to make a taxable income mystery shopping unless you do this full-time. Don't inflate your losses needlessly by claiming expenses you didn't have to make.

I am still confused since they are differing opinions.

Time to consult a tax professional, lol! Seriously, when in doubt err on the side of caution with the IRS.

If it was possible to hit "like" 50 times, it still wouldn't be enough to agree with what Lisa said.

In this case, opinion isn't going to cut it. Shell out that $50 to sit down with someone and really find out the answer to your question.

It could be a matter of $50 now, or $28487575884484747 later (okay, I'm not even sure how you'd _say_ that number... but you know what I mean). =)))

Sending the best,

Jen

Your best source is the irs.gov website, actually. Do your own research, and if still confused about which of the seemingly conflicting rules applies to your situation, consult your tax preparer about it.

The point of my post was to emphasize that there are different circumstances possible where you might go over reimbursement so no "yes or no" answer will apply in every situation. The safest thing, the one that will never get you in trouble, is to deduct the lower of whatever you actually paid or whatever the maximum reimbursement was (if you paid more). That's the safest thing.

My source of information was the irs.gov website but I am not citing the chapter and verse because it's best if everyone reads it for themselves and applies what they learn to their actual circumstances.

I just got my first shop rejected Can I claim this as a business loss?

veggiegirl Wrote:
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> I just got my first shop rejected Can I claim
> this as a business loss?


Yes you can. It is an expense.

You deduct the expenses related to the shop, the mileage and anything you spent that you won't be reimbursed for. You can't deduct the fee you won't receive. You just don't have that as income like you would have if you'd been paid for the shop.

There was a mystery shopper tax expert presenting at the IMSC conference in Las Vegas last year. I believe her name was Carol, but my recollections that far back are not reliable. Anyone know her name? Servanne?

In what circumstance, can you claim a meal as an expense?

techman01 Wrote:
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> Karen IL Wrote:
> --------------------------------------------------
>> If buying a snack was not a requirement and you bought one anyway, then that
>> is not reimbursed either, even though the wine would be below 4.75.
>
> i asked many years ago and as long it is reasonable they said it is ok...

It is very unreasonable to think that any wine under $4.75 per bottle will be OK.

You can deduct a meal if you are entertaining a client (which will not generally apply to us) or I believe if you are traveling at least 50 miles outside your "home" area you can deduct a meal allowance, but it's only 50% that you can deduct. Basically if you're having to eat out whereas normally you could have eaten at home, they let you deduct half of what you pay. If you're overnight away from home, there's a "per diem" amount you can deduct where you don't have to have a receipt. But check on the irs.gov website or ask your tax preparer -- I'm going from memory here.