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Combining Fees and Reimbursements on taxes

September 22, 2017 06:21PM
Some shoppers have mentioned they combine all fees and reimbursements together to find their yearly income, then deduct the reimbursements to show their taxable income. For shoppers that do this, what if the receipt exceeded the maximum allowed reimbursement? Example, you were told you would be reimbursed up to $10, but you spend $15... would you deduct the allowed $10 or the full $15?
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More About Reimbursements
September 22, 2017 10:06PM
To keep it easy, I deduct just the reimbursed portion. I also do not do many shops heavy on reimbursement. Others have based how much to deduct on if it is possible to complete the shop within reimbursement. For example, a shop reimburses $10 and you can find a purchase for $10 or less that would be the deduction. If the cheapest item in the store is $15 then the deduction is $15 because the shop could not be completed to specifications without the purchase.

Equal rights for others does not mean fewer rights for you. It's not pie.
"I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag." -Molly Ivins
Never try to teach a pig to sing. It's a waste of your time and it really annoys the pig.
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September 23, 2017 01:39PM
I've looked at both. I ended up just with the reimbursement last year. Technically, sure, if you do a grocery shop that reimburses $10 and pays $10, you could spend $20 and not have "made" any cash on that shop, but it is extra data entry and tax stuffs. Taxes can be a headache anyway, particularly if you have a second business or a regular position.

Did you deduct your miles, did you deduct your work laptop, did you deduct internet and phone? Were they even deductible? Did you donate anything for your own W2 work, did you measure the house and your home office and get your square footage? Did you take any business meetings and keep receipts to get your $8-$12 write-off for lunch? Did you remember to .. bleh. Medical payments, new house, new car, taxes on property, state laws, receipts for parking, toll tickets and on and on and on.

Basically, keep records. Keep good records and ones that make sense. They should make sense to you, but realistically they ought to be easily explained to another human because if you take an account a mess they can't figure out because you think "it's their job, they should just do it" you'll likely regret it. Not saying you'd think this tongue sticking out smiley

Short answer -- it's easier to just accept the reimbursement.

MegglesKat
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September 23, 2017 06:22PM
"if you do a grocery shop that reimburses $10 and pays $10, you could spend $20 and not have "made" any cash on that shop, but it is extra data entry and tax stuffs."

This is one of the reasons I love Quicken. It takes no time to categorize each expense. If the reimbursement is $10 and I spend $20 the amount is entered as $20 then split into groceries and reimbursed expense. The reimbursed expense then shows up on the report I run for the tax accountant.

Equal rights for others does not mean fewer rights for you. It's not pie.
"I prefer someone who burns the flag and then wraps themselves up in the Constitution over someone who burns the Constitution and then wraps themselves up in the flag." -Molly Ivins
Never try to teach a pig to sing. It's a waste of your time and it really annoys the pig.
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September 24, 2017 02:12AM
I use HR Block's software and input everything out of my spread sheets. One nice thing is once the new tax laws are updated, I can go ahead and start entering some of my information late November or early December and get things rolling. My W2's always seem to get mailed on the last possible date and then show up a week or three into February -_-

MegglesKat
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September 24, 2017 07:19PM
I enter fee and reimbursements for total earned. Then show reimbursement as amount repaid by Company. Balance is total earnings. In my experience, the 1099 will only show the total fees paid, no reimbursements are included. So by adding them to your taxes creates a few more steps for you to take. I definitely would set up a spreadsheet with all information included (reimbursement separate from fees) just in case the Tax man comes calling.
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