Discussion:Tax Treatment of S-Corp Expense Reimbursement
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Discussion Forum Index --> Tax Questions --> Tax Treatment of S-Corp Expense Reimbursement
| 28 February 2007 | |
| An S-corp property management company paid a legal bill in December 2006 on behalf of a client. Client wrote and mailed the reimbursement check to S Corp on 30 December. S-crop received and deposited the check in its bank in January 2007.
How sould the S-Corp handle this transaction on Tax Return? Does the S-Corp have to show the expense in 2006 and income in 2007? Thank you in advance. | |
| 28 February 2007 | |
| A taxpayer may not claim a deduction for an expense incurred for the benefit of another taxpayer. | |
| February 28, 2007 | |
| Agreed. Amount paid on behalf of client would be a balance sheet item (ie, Accounts Receivable). | |
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