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    1 Reply Latest reply on Mar 25, 2009 9:39 AM by LUCKIEST

    Expense Reimbursements

    DubsSpb Newbie
      I am the owner and the sole employee of an S-Corp in Pennsylvania. My client, a government agency, requires me to travel to different sites on a weekly basis. I get reimbursed for my expenses such as airfare, hotel, rental car, meals per diem (fixed amount of $54/day no matter what I actually spend for food). I bill the client weekly for labor and expenses on the same invoice, thus the check that I get from them is the sum of labor + expenses for the given week.

      My question is what would be the best way to handle expense reimbursement in this case? I charge all business travel expenses to a business credit card. I'm seeing two different scenarios here:

      1) I pay off the business credit card from the business checking account. End of story.

      2) I reimburse myself as an employee through payroll by paying out employee expense reimbursement in addition to the salary. The reimbursement would of course not be a subject to payroll taxes.

      Both scenarios allow me to write off business expense so that the corp doesn't get taxes on expense reimbursement income.

      Does anybody have any recommendations for my scenario?

      Thanks in advance!