$$ transfer at TAX time question

[sbp]

Hi
I have account setup on middle of this year with my business name.
I didn't got any credit card and so all purchase I made using my personal credit card.
Now can I just withdrow that amount from business account?

[Pikachu]

Are you incorporated? If not its all your money anyhow. Doesn't really matter which account you draw it from.*

*Not intended to be construed as legal advice.

[sbp]

what is incorporated? I have got DBA number from county. I have use my SS number for tax id over there.

[hhscr]

Sounds like you are a sole propriotor. Check with your CPA and attorney too make sure, but as a sole propriotor I don't think you have to keep business money seperate from personal money, (however, it makes it easier come income tax time because you still have to fill out the Schedule C for the IRS.)

Incorporated is where you set up a legal corporation through the state secretarys office and the business will be in a name with the Inc. or possibly the LLC after its name to identify it as a corporation. A corporation is considerd its own entity for business and tax purposes and you can not put corporate money into your personal account and vice versa.

Good Luck, a good CPA and attorney is usually worth the money to help set things up right from the start so problems don't pop up later.

[adirty1]

I would pay the card out of that account and write it off as an expense.
Or if it's too late and you have paid the card off from another account i would pay myself the money from the business account and write it down as an expense.

I just keep the visa bills and dont really worry about where the money came from. when the cpa does the books she knows if the company made or lost money. I have a copy of the whole year of visa bills that are just from the business card. This works out great no more keeping up with receipts and i get miles.

sort of the answer No it doesnt matter...

[LadyShutterBug]

um, i don't think a credit card log is going to cut it if you get audited.

you need to be keeping receipts for business expenses.

as a sole proprietor, it doesn't matter where the money is being spent from (personal account, business account, credit card)... you just need to account for your business expenses and your business income when you do taxes.

[sbp]

Thank you guys and girl

I have paid all credit card and don't have statment saved. But I do have all receipts. This all makes little more sense now

[Shane]

Your best bet is to get a good CPA as the tax laws can be very complex and it helps getting good advice. I worked in Acct/Finance for years and still hired a CPA to deal with taxes as too many things change every year to keep up with them all. Better to be safe than sorry - especially if you ever get audited.

[adirty1]

Originally Posted by LadyShutterBug

um, i don't think a credit card log is going to cut it if you get audited.

you need to be keeping receipts for business expenses.

as a sole proprietor, it doesn't matter where the money is being spent from (personal account, business account, credit card)... you just need to account for your business expenses and your business income when you do taxes.

you would think incorrectly.
cpa. ask'em. If you provide something that can prove you made a purchase then it's up the the irs to prove other wise. If the IRS sees anything that keeps a record of events then your not going to have an issue. something as detailed as a visa bill with sku's , dates , times, payoff, and store locations. you can cross check it with store even. my god it beats a receipt that i could have printed out on my dot matix...

[adirty1]

Originally Posted by Shane

Your best bet is to get a good CPA as the tax laws can be very complex and it helps getting good advice. I worked in Acct/Finance for years and still hired a CPA to deal with taxes as too many things change every year to keep up with them all. Better to be safe than sorry - especially if you ever get audited.

very true. I just got a new cpa a few years back and filled her in on how touchy photography taxes could and can be. she started digging and found out that photography taxes can be very complecated.

[AndrewCCM]

Originally Posted by adirty1

you would think incorrectly.
cpa. ask'em. If you provide something that can prove you made a purchase then it's up the the irs to prove other wise. If the IRS sees anything that keeps a record of events then your not going to have an issue. something as detailed as a visa bill with sku's , dates , times, payoff, and store locations. you can cross check it with store even. my god it beats a receipt that i could have printed out on my dot matix...

More than half my receipts are completely faded to nothing within a few months. I started photocopying them just to have on a few things.

[LadyShutterBug]

i suppose it's different strokes for different CPA's. mine wants detailed receipts.