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Megan C
Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 12531
Experience:  Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
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I am 25% owner of a 3-person company. We are all owners. We

Resolved Question:

I am 25% owner of a 3-person company. We are all owners. We have no employees. Is there a list I can reference of what benefits the company can give us that would then be deductible? I would like the company to give the owners benefits that the IRS will approve of as deductions.
Submitted: 10 months ago.
Category: Finance
Expert:  Megan C replied 10 months ago.

MyVirtualCPA :

Hello, and welcome to JustAnswer.com. How are you tonight?

MyVirtualCPA :

You can get a list of employee benefits that would be deductible in publication 15, Fringe Benefits Overview.

MyVirtualCPA :

You can access that publication, here: http://www.irs.gov/publications/p15b/ar02.html

MyVirtualCPA :

Do you have any questions about any particular benefits?

MyVirtualCPA :

The publication is quite extensive and gives detailed information about the deductible expenses

Customer:

Thanks! I will read that. Yes. First question is: how do we classify ourselves? The company is an LLC and we are all owners. Does that also make us employees? I want to make sure I use the right words because the rules are so specific.

MyVirtualCPA :

You are actually Partners. An LLC is no different than a partnership

Customer:

OK. How about auto expenses? We are flipping houses. We don't have an office. We meet at real estate agent offices or the house we're working on. The idea of keeping a log for mileage is so onerous 95% of my miles are for business. Do I have to keep a log?

MyVirtualCPA :

You can write off only the portion of the vehicles that is used for business purposes

MyVirtualCPA :

You can write off actual expenses or mileage, and to tell you the truth mileage is a better deal typically

Customer:

So I do need to keep the log?

MyVirtualCPA :

Yes, you will need to keep a log of mileage

Customer:

It'd be less work to write down the driving I do for personal reasons as there's much less of it. Could that be the log and everything else is business?

MyVirtualCPA :

You really need a log for business

Customer:

OK I have to reconstruct it for this year. Do you think it makes sense for the company to have a vehicle? I was wondering if that would be a deduction. We really need a truck but you know it'd end up being used for personal reasons and then what do you do.

MyVirtualCPA :

whether the company owns the vehicle or you own the vehicle it doesn't matter - the expense is the same

MyVirtualCPA :

It's best to own it personally if it's ever used for personal

Customer:

I was thinking I'd be able to deduct the actual cost of the vehicle on schedule c.

MyVirtualCPA :

yes, you can deduct actual expenses or mileage, and mileage usually works out better on the long run

Customer:

ah I see what you're saying.

MyVirtualCPA :

And once you choose actual expenses you can't ever claim mileage

Customer:

And either way I have to keep the log! :)

MyVirtualCPA :

Yes that's correct

Customer:

We eat out a lot because we're on site. Can the company give the partners per diems for that? Would it be deductible?

MyVirtualCPA :

Yes, you can and yes that would be deductible

Customer:

So that's a way for us to save taxes... we're going to spend the money anyway but this way we get a tax break. That's the kind of thing I'm looking for. I see the gym is not an option because it'd have to be on our premises.

MyVirtualCPA :

Yes, that is true

MyVirtualCPA :

Is there anything else I can assist you with? If not, please rate my response as "excellent" so that I may receive credit for assisting you today

Customer:

thank you I will be happy to do that.

Megan C, Certified Public Accountant (CPA)
Category: Finance
Satisfied Customers: 12531
Experience: Licensed CPA, CFE, CMA who teaches accounting courses at Master's Level
Megan C and 4 other Finance Specialists are ready to help you
Expert:  Megan C replied 10 months ago.
Thanks for your positive rating. Please come back and visit MyVirtualCPA for any of your tax, finance, or social security needs. It was a pleasure working with you today.
Customer: replied 10 months ago.

I keep getting requests to respond to your last post so I'm responding here :)

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