tag:blogger.com,1999:blog-8898469830539515655.comments2023-10-10T06:40:25.981-05:00Accounting and Tax TipsKenneth Reidhttp://www.blogger.com/profile/15976434299669878977noreply@blogger.comBlogger194125tag:blogger.com,1999:blog-8898469830539515655.post-70144262752949680412018-03-18T19:43:14.362-05:002018-03-18T19:43:14.362-05:00Thank you so much!! You've been extremely help...Thank you so much!! You've been extremely helpful!Stanhttps://www.blogger.com/profile/16870654400835879512noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-25129691054412925342018-03-17T07:07:41.555-05:002018-03-17T07:07:41.555-05:00Just report the travel expenses in excess of Per D...Just report the travel expenses in excess of Per Diem received.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-21798834052147155192018-03-16T20:16:44.308-05:002018-03-16T20:16:44.308-05:00Kenneth,
Thank you so much for your thorough answ...Kenneth,<br /><br />Thank you so much for your thorough answer! Your information is very helpful.<br /><br />My husband's last stub YTD income is the same as reported on the W-2 form. <br /><br />Should my husband report on the tax return the amount that he received as reimbursement or only report travel expenses in excess of the reimbursed amount? <br /><br />Thank you!Stanhttps://www.blogger.com/profile/16870654400835879512noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-23734184364536311302018-03-16T06:48:26.548-05:002018-03-16T06:48:26.548-05:00Sara,
I have seen some employers who do not inclu...Sara,<br /><br />I have seen some employers who do not include Per Diem on employee W-2s, and I have seen other employers who DO include the Per Diem on employee W-2s. I would say that it is not safe to assume the Per Diem is not included on the W-2. Check the last paystub for the year to see if the ytd income shown on the paystub is the same as what is shown on the W-2.<br /><br />Usually, Per Diem is included on the same line as W-2 income on the tax return. It is usually "backer out" on the Other Income line (I believe this is line 21).<br /><br />Travel expenses normally include air fare, hotel, car rental, mileage (if a personal vehicle is used), gasoline, and meals (50% - so if meals were $150, you would enter $150, but only 50% ($75) would actually be deductible). DO NOT double meal expenses. You MUST be able to substantiate all travel expenses.<br /><br />2017 is the last year in which Form 2106 can be used. Between 2018 and 2025, no unreimbursed employee expenses are deductible on tax returns - this includes travel expenses.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-44356171212026085202018-03-15T22:55:59.357-05:002018-03-15T22:55:59.357-05:00Hi Kenneth and thank you for the Blog! My husband ...Hi Kenneth and thank you for the Blog! My husband received per diem by his employer at a rate which is lower than the federal tax rates. He didn't have to provide any expense reports. <br />1. Because the per diem was paid at a rate lower than the federal rate, is it safe to assume that this amount is not included on the W-2 form?<br /><br />2. Does the amount received as reimbursement for travel expenses need to be reported on the tax return. If yes, where exactly?<br /><br />3. What travel expenses incurred by my husband while working away can he claim on the tax return? <br /><br />Thank you,<br />SaraStanhttps://www.blogger.com/profile/16870654400835879512noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-14926818120927281872018-03-03T16:32:58.930-06:002018-03-03T16:32:58.930-06:00Thank you very much, Kenneth. I sincerely apprecia...Thank you very much, Kenneth. I sincerely appreciate your tips and will let you know if I have any questions. You're doing a great service!<br /><br />ErinErinhttps://www.blogger.com/profile/16758215693623699914noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-77984261078154252692018-02-27T06:37:10.778-06:002018-02-27T06:37:10.778-06:00Erin,
You have to fill out Schedule C for the 109...Erin,<br /><br />You have to fill out Schedule C for the 1099 income. Deduct all your expenses on the Schedule C, including all expenses for which you were reimnbursed (that are included on the 1099). Also deduct the per diem (as expenses). You should also deduct the mileage/fuel expenses (both the expenses that were reimbursed to you and those that were not reimbursed). All of these expenses need to be shown on your Schedule C. The 1099 shows all money paid to you, even though reimbursed expenses, per diem, etc. should not have been included on the 1099. You have to bring the income down to what you should have received had the 1099 been correct, minus your expenses against the income received.<br /><br />The net taxable income on the Schedule C should be your net income from the 1099 after all expenses.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-55150420190593451152018-02-26T20:20:22.737-06:002018-02-26T20:20:22.737-06:00Hi Kenneth,
Thank you for such valuable informatio...Hi Kenneth,<br />Thank you for such valuable information. <br />I am having trouble and am hopeful you have some insight. I received a 1099-MISC for some contract work I did out of state late last year. It has all the money that was paid to me reported in one box, and I find this troubling. Included are my wages, my M&I per diem rate ($64/day in Los Angeles), and some expenses that were directly reimbursed to me (i.e. fuel). The company paid directly for a rental car and lodgning. I've read the per diem rate is not taxable so long as it is not above the federal guideline (which mine was not). I already paid taxes on the money I used to pay for fuel, and now it seems I'm being taxed on it again. <br /><br />Were they correct to lump all of those together on my 1099-MISC? <br />Can I deduct $64/day for the duration of my contract? How? I did not keep receipts for every dollar spent on M&I. <br />Can I deduct the actual reimbursed expenses? How? <br /><br />I have been using TurboTax and found the amount I owe the IRS doubles if all that money is counted as wages. <br /><br />Please help.<br /><br />Thank you for your time!<br />ErinErinhttps://www.blogger.com/profile/16758215693623699914noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-85746956687727072692017-07-12T19:05:51.017-05:002017-07-12T19:05:51.017-05:00Sofiko,
The employees MUST return the per diem re...Sofiko,<br /><br />The employees MUST return the per diem received for France. If the employees refuse to return the amounts received for France, the amounts MUST be added to the employee's income as taxable compensation (all taxes apply - Federal withholding, Medicare, Social Security, State withholding, FUTA and SUTA, and any other state taxes that might apply).<br /><br />The per diem amounts are simply added to the employees wages, and should be grossed up (to allow for withholding taxes). For instance, if the net pay (per diem amount) is $319.40 (for example), the pay should be grossed up to about $400 (gross pay). This is just a rough approximation of the gross up amount, and is not to be taken literally. It is just an example.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-43651944547345857842017-07-12T16:18:03.403-05:002017-07-12T16:18:03.403-05:00Hi Kenneth,
First of all thank you for all in dep...Hi Kenneth,<br /><br />First of all thank you for all in depth explanation. <br /><br /> Can you please advise:<br /><br />2 of our employees have been sent overseas to business trip Sweden and France. Company provide flat rate for M&IE based on GSA foreign rate. While Sweden task has been complete, France job has been postponed to later, but both of the employees stayed in France on their personal time. Can you please advise: <br />1. If the amount designated for France M&IE need to be returned in full by the employee arrival or it can be count for the next trip that will happen later? <br />2. If employee won’t return the M&IE how it can be reported as their wages? <br /><br />Another question is can you please briefly advise what is the rule to apply M&IE rates during the weekend stay and on arrival/departures days. <br /><br />Thank you!<br />Sofia<br />Sofikohttps://www.blogger.com/profile/16938643703432928039noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-34258041818757484462017-03-21T12:02:03.258-05:002017-03-21T12:02:03.258-05:00mtmAVman,
Since you are a "contractor" ...mtmAVman,<br /><br />Since you are a "contractor" receiving a 1099-misc, you cannot deduct any of the meals at 100%, they must all be taken at the 50% rate. The per diem paid by the company that hires you as a contractor cannot be more than the allowed amount that is set by the IRS. Any amount that is over and above the IRS amount is totally taxable to you. The IRS amounts for per diem vary by "region" and sometimes by city (and the time of year). You should check the IRS website for the current per diem rates for the areas and cities that you travel to.<br /><br />The only time you can write off 100% of meal expenses is if you had people working under you and you (as the employer) purchase food for the employees to eat "on the job site" for the "employer's convenience". Otherwise, all meal expenses are only allowed the 50% deduction (unless you are a truck driver, in which case there are special rules that apply).Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-49191482004602223692017-03-21T10:26:51.207-05:002017-03-21T10:26:51.207-05:00Hi Kenneth, thanks for all the information you pro...Hi Kenneth, thanks for all the information you provide here! I'm trying to figure out how to account for Per-Diem as an independent contractor, DBA. In the industry in which I work there are two methods that companies will use to reimburse meal expenses to independent contractors who work out of town; <br />1) The company chose a Per-Diem rate that they allow the contractor to invoice. I bill a day rate for my labor, for every day on the road, and the allowed per-diem rate per day away. Both labor and per-diem are lumped together on line 7 of the 1099-misc I receive.<br />2) The company pays exact expenses which are reported by on my invoice and documented by receipts, but there are limits they will pay for each meal. I bill my labor day rate, and allowed expenses, which are lump together on line 7 of the 1099-mics I receive.<br /><br />Most of the information I'm finding on this has to do with employee/employer relationship reported on a w-2, and accountable vs. non-accountable reimbursements. Its seams that I might be in several different categories. I'm trying to future out the best method for handling this on my taxes. I know there are some instances I can deduct %100 of the meals and other are at %50. Since I'm paying income tax on the reimbursed expenses, I want to write off as much as possible. Can you shed any light on this? <br /><br />mtmAVmanhttps://www.blogger.com/profile/08373232472763515821noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-54582368978623083052017-03-18T00:12:08.436-05:002017-03-18T00:12:08.436-05:00Thanks for the information... I really love your b...Thanks for the information... I really love your blog posts... specially those on<a href="https://www.filemyit.com/" rel="nofollow"><b> <br />Preparation of Form 12BB </b></a>Anonymoushttps://www.blogger.com/profile/12000733262831071471noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-83585725654692973952017-02-04T08:54:01.178-06:002017-02-04T08:54:01.178-06:00It may be that the travel reimbursement, even thou...It may be that the travel reimbursement, even though made under an accountable plan, was taxable. If the travel to a particular location was not considered temporary (lasting or expected to last more than one year or an indefinite period of time), then the reimbursement is taxable compensation regardless of whether an accountable plan was in place. Likewise, if the employee is considered an itinerant worker (travels to all jobs with no real work "home base"), then his tax home is where he works and, again, travel reimbursements are taxable.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-62409047681808445662017-02-02T18:30:29.175-06:002017-02-02T18:30:29.175-06:00Wow, this thread is still alive. So when your emp...Wow, this thread is still alive. So when your employer is incorrectly including per diem in your gross pay and witholding taxes, what is the appropriate way to back this out on my tax return?Brucehttps://www.blogger.com/profile/05754639696914549898noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-88105652946357732602017-01-30T18:00:31.378-06:002017-01-30T18:00:31.378-06:00If the employer pays less than or equal to the IRS...If the employer pays less than or equal to the IRS Per Diem rates, the Per Diem payments are not taxable. However, if the employer pays more than the IRS Per Diemm rates, the excess amounts are taxable income, subject to federal and state withholding, Medicare and Social Security taxes, as well as Federal and State unemployment taxes.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-9911112824290554742017-01-30T11:45:06.887-06:002017-01-30T11:45:06.887-06:00Can my employer pay me less the federal amount and...Can my employer pay me less the federal amount and tax me after 1 year ?Kav1989https://www.blogger.com/profile/14122448160743834179noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-54341471135316631742016-01-25T22:44:22.883-06:002016-01-25T22:44:22.883-06:00When you are a young adult it can be hard to know ...When you are a young adult it can be hard to know if you should file <a href="http://www.schrammlewiscpa.com/services" rel="nofollow"> taxes</a> or not. I like that you talked about there being several ways to know if you should figure out if you need to. It might be a smart idea to talk to a professional about that if you are really confused.Anonymoushttps://www.blogger.com/profile/00990449449072589783noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-82280316758226052972016-01-22T08:02:13.504-06:002016-01-22T08:02:13.504-06:00Luke,
I would like to help, but doing so on the b...Luke,<br /><br />I would like to help, but doing so on the blog is not the best way to help you. Please contact me privately and I will get back to you as soon as possible.Kenneth Reidhttps://www.blogger.com/profile/15976434299669878977noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-45432355569014758822016-01-20T19:29:00.661-06:002016-01-20T19:29:00.661-06:00With taxes coming up I wanted to know more about w...With taxes coming up I wanted to know more about what I needed to do, for my <a href="http://www.hendersonmccoll.com.au/our_services/tax___audit_services" rel="nofollow"> tax return</a>. I have wonder what I would need to do about health insurance. I like the list of reasons someone would not need to have health insurance like Medicare, Veteran's health care, etc.Anonymoushttps://www.blogger.com/profile/04600379781447651038noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-77645321982992242682015-07-06T03:35:12.996-05:002015-07-06T03:35:12.996-05:00Thanks for describing the importance of payroll ou...Thanks for describing the importance of <a href="http://pnjgconsulting.com/services/visa-services/" rel="nofollow">payroll outsourcing service</a>. Very informative and helpful!Anonymoushttps://www.blogger.com/profile/18373680466571675253noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-36221318669983380162015-06-25T18:18:02.316-05:002015-06-25T18:18:02.316-05:00I didn't even know that you could deduct thing...I didn't even know that you could deduct things like that on your taxes. That's a really nice buffer to have. It's very possible that I'll be living somewhere soon that has hurricanes and storms and things. This will be something that I'll need to know how to do just in case. <a href="http://kaneskicpa.com" rel="nofollow"> http://kaneskicpa.com</a>Anonymoushttps://www.blogger.com/profile/06500700087368270847noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-44190987609977034202015-06-10T01:45:33.548-05:002015-06-10T01:45:33.548-05:00I had a great time reading this blog and tips abou...I had a great time reading this blog and tips about <a href="http://tmaaccountants.com.au/services/" title="Tax" rel="nofollow">tax</a>. I will share this to my friends. Thank you!Anonymoushttps://www.blogger.com/profile/12388864029051430844noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-65227487217188374022015-06-10T01:45:08.598-05:002015-06-10T01:45:08.598-05:00I had a great time reading this blog and tips abou...I had a great time reading this blog and tips about <a href="http://tmaaccountants.com.au/services/" title="Tax" rel="nofollow">tax</a>. I will share this to my friends. Thank you!Anonymoushttps://www.blogger.com/profile/12388864029051430844noreply@blogger.comtag:blogger.com,1999:blog-8898469830539515655.post-33329361226525553402015-05-15T01:54:10.180-05:002015-05-15T01:54:10.180-05:00I had a great time reading your blog. Thank you fo...I had a great time reading your blog. Thank you for sharing this useful information, I find your blog interesting and easy to understand. I was looking for this for a week now. I'm looking forward to read more informative content about <a href="http://tmaaccountants.com.au/" title="Tax Time Robina" rel="nofollow">Tax</a>. Again, Thank you.Anonymoushttps://www.blogger.com/profile/12388864029051430844noreply@blogger.com