Fee vs reimbursement and tax write off

@bgriffin wrote:

Unless you were planning on buying 2 shirts anyway you are absolutely in the hole.

I can always use another shirt.

Create an Account or Log In

Membership is free. Simply choose your username, type in your email address, and choose a password. You immediately get full access to the forum.

More About Reimbursements

Seems to me this would make more sense and less clutter if posted to the already existing thread

It would certainly be less confusing and make far more sense to post to the other thread. I've reported to the moderator to request they combine this with john's previous thread. It would also be nice if the threads were moved out of general chat and into MS discussion.

Can you try answering the question too?

Try this thread for starters:

[www.mysteryshopforum.com]

In particular, these statements are applicable:

Unless someone knows your entire tax situation -- filing status, dependents, amount and nature of any other income -- they will not be in the position to advise you what is the best way to report your mystery shopping income.

Do not rely on the people in this forum to tell you about these things. They are not going to be paying any penalties if they advise you incorrectly. Likely if your tax professional advises you incorrectly, they will pay the penalties for you.

@johnb974 wrote:

I posted asking a question on write off for reimbursements. I looked at the shops and realized something. The $13 is a fee (payment for the shop) not a reimbursement. For this shop you are required to purchase 3 clothing items, and return 1. You are paid a fee of $13. Are the two items you have to buy, a write off? Before I thought the $13 was reimbursement, it's not. There's no cost limits on the two items you have to buy. Since it's a requirement for the assignment to buy two items, is there any limit to the amount? The fee and reimbursements are two different things for write offs.
If I buy 3 shirts for $13 each, bring back one, can I write off the $26 for the other two? Can I buy 1 shirt for $13, other for $50 and write off the full $63?

Why would you write off $26 for the two shirts you listed?

Including your $13 fee for the assignment, you'll be $13 in the hole unless you have other shops that day to make up the loss?

Same goes for the scenario of the $63 worth of shirts? For that, you'll be $50 in the hole.

For what reason do you believe it's a reasonable tax write-off?

Very infrequently shopping the Greater Denver Area, Colorado Springs and in-between in Colorado these days.

The best plan both from a profit and IRS angle is to stay within the reimbursed amount if possible. How anyone decides to handle something like this is a personal decision. You can deduct absolutely anything you like, but it may not hold up in an audit. I don't think it's likely a part time mystery shopper will be audited, but if that happens and they find enough variances to make the audit profitable for them they'll probably audit you every year for a while. That's a chance we take when we get into a gray area. I think this can be argued either way but the outcome is uncertain.

Mary Davis Nowell. Based close to Fort Worth. Shopping Interstate 20 east and west, Interstate 35 north and south.

There is no reimbursement. You only get paid $13, but you are required to buy 2 items. The question is, can you write off the total cost of the two items, since you are required to buy them and there's no reimbursement.

Because you want the write off to lower your taxes. I'm buying the items anyway, so why not use them as a write off. It's not a loss, you WANT those shirts.

@johnb974 wrote:

There is no reimbursement. You only get paid $13, but you are required to buy 2 items. The question is, can you write off the total cost of the two items, since you are required to buy them and there's no reimbursement.

But your guidelines require you to return as part of your assignment....

Very infrequently shopping the Greater Denver Area, Colorado Springs and in-between in Colorado these days.

You return one item, but keep two. There's no reimbursement for the two you keep, only a $13 fee you a paid. Since there's no reimbursement and you are required to keep two of the items, does that make them a write off?

This won't necessarily answer your question, but is MS a business or a hobby for you? There are many here who would identify this as a business but also quite a few (like myself) for whom MS is more of a hobby. Based on you being willing to do a purchase and return shop with 2 visits required for nothing more than $13 to offset required purchases, I'll assume this is essentially a hobby for you. If that's the case, check out items 3 & 4 of the document below for guidance.

[www.irs.gov]

It is a job for me, I am registered as an Independent Contractor. I'm doing this almost full time.

@johnb974 wrote:

You return one item, but keep two. There's no reimbursement for the two you keep, only a $13 fee you a paid. Since there's no reimbursement and you are required to keep two of the items, does that make them a write off?

Is that what the guideline specifies or you have the freedom to return as much as you like for the assignment?

Very infrequently shopping the Greater Denver Area, Colorado Springs and in-between in Colorado these days.

You can only return one item. You buy 3, return 1.

This sounds like a crappy shop that I would never do.