Posts by Sophia Sanders3

Brenda Chase3 said:Yes, it is exactly as she described. A sole proprietor doesn't need to provide documentation for withdrawing funds from the business account because, at the end of the year, they’ll be paying taxes on everything that wasn't categorized as a business expense anyway. That money effectively becomes their income, and they’ll pay the appropriate income tax on it. It’s a bit different from a corporate director, who draws a set salary and therefore has to justify every dollar spent outside of that paycheck. A sole proprietor doesn't have a fixed salary in the traditional sense; instead, they have net income (which essentially functions as their pay), which is why the tax return is filed based on that total income.

Great, thanks for the clear explanation! And thanks to lady g too..🙂

placidlynx92 said:Look, that gas receipt just isn't a deductible expense—you can toss it or tuck it away with a mileage log if you really want to 😉, but the point is that using a personal vehicle for work is handled differently. As an LLC owner, you have total control over the funds in your business checking account; you can withdraw cash, pay personal bills, whatever—it doesn't need to be "justified" to anyone because it's your money for your own needs. However, if you want to actually pay yourself that $0.67 per mile, you need actual documentation to back up that deduction in your books (like a mileage log or a travel voucher).

As for Form 941, you can check out the details here http://www.irs.gov/forms-pubs/about-form-941 and there's also a dedicated thread about 941s right here on this forum.

So, if I'm following correctly, if a small business owner has $1667 in their account and pulls out $1000 for themselves (personal stuff, food, drinks, bills, going out, whatever...) they don't actually have to "prove" how that $1000 was spent??? I don't quite get that... can they really just spend that money without any receipts? I mean, if that's true, that sounds awesome!!😍
Because with an LLC or a corporation, everything has to be accounted for...

Thanks for the info on the tax forms, I already took a look..

placidlynx92 said:1) You should track mileage for using a personal vehicle for business purposes and calculate a reimbursement $0.67 per mile. (You can technically use the business card for gas, but it won't count as a direct business expense; you'd just note that it was for the owner's personal use)
2) Yes, you can. Use a standard travel expense report; all business trip costs and per diems are fine.
3) No.
4) Anything directly related to operating the business. 🤷
Don't forget to account for payroll taxes regarding the payments in 1) and 2). 😉

okay thanks, but I'm lost on number 1). so, if I pay for gas with the business card, what happens to that receipt if it isn't a business deduction? like, if I pay for gas $167 with the business card but that receipt doesn't count as an expense (since the car isn't owned by the LLC), how do I explain why the business card was used if it's not a deduction? (since I'm already paying myself via $0.67/mile). please, could you clarify that a bit better? thanks a lot.😕😕

What exactly is a payroll tax filing? Is it something you have to submit somewhere, and if so, when is the deadline?🤷

Hey everyone, I could really use some advice from the seasoned pros here!
I’ve got a small business set up with no employees, and the owner actually holds a full-time job at another company. It’s just him running the show for this side gig.
Since I'm totally new to the world of small business ownership, I have a few questions:

1) How do you handle fuel expenses or reimburse yourself for gas if the car isn't registered under the business name??? Am I allowed to use the business debit card or credit card for gas? This is huge because there's a ton of driving involved.
The car isn't going to be moved over to the business right now. So, I need tips on how to maximize those fuel deductions legally without anything getting "off the books."

2) Also, regarding business travel—can the owner claim per diems and reimbursements for things like tolls, meals, or even taking a client out to lunch?

3) Can a monthly life insurance premium for the owner be listed as a business expense?

4) Could you give me a quick rundown of what typically counts as a deductible expense for a business specializing in lighting and event planning?

- We aren't registered for sales tax purposes.
Thanks in advance... I'll probably have more questions once I dig into this deeper.🙂