embersmithllcembersmithllc Member Posts: 4

Hello All,

I'm running a web Design business out of my house and I'm wondering how much I should be reimbursing myself for internet and cell phone expenses as they're both critical for the business.

-Thanks in advance!


  • CharlotteCharlotte Member Posts: 695 admin

    Hey @embersmithllc thanks for joining us! If I'm understanding you correctly, you're wanting to reimburse yourself for business expenses you've personally incurred.

    In that case, you'll want to some bookkeeping across your business and personal profiles. In that case, you'll want to add the expense on your Personal profile, and then categorize as Owner Investment/Drawings. Next, create a journal transaction with three lines:

    • Debit the relevant expense account for the pre-tax purchase
    • Debit the appropriate sales tax receivable account the sales tax
    • Credit Owner Investment/Drawings by the total amount

    We also have a guide here for a more thorough breakdown.

    In terms of how much, this is something I'd want to run by an accountant or expert in your area. If you'd like to share your location and any other important info here, or in our Pro Network, we can do our best to help connect you with someone in your area.

  • MikegMikeg Member Posts: 772 ✭✭✭

    You will have to do your best to determine business use versus personal use. The business use would be a business deduction. Based upon you user name I'm assuming you are a single member LLC. Therefore, Schedule C of the 1040. It will be up to you to determine the amount. Most of my clients will use a percentage. To give you a sense 60-80% business depending on the nature of the work. Being in a technology dependent business would lend itself to a higher business use percent. Be sure to document how you arrived at your percentage. Feel free to shoot me any more questions.
    Mike G, CPA
    Better Service - Better Pricing

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