Originally Posted by snic

Does your company give you a 1099? I'm in a similar boat, except I work for a different company than the organization for which I consult. That organization gives me a 1099 each year. The value stated on the 1099 includes both payment for my services and reimbursement for my expenses. I then report that value (less documented expenses) as business income on my personal tax return. If you do all of that, you can easily prove that you have a business. (As I understand it - please correct me if I'm wrong!)

I'm guessing that because you're an employee, all you get from your employer is a W2. Then you don't have business income even if you get reimbursed for out-of-pocket expenses.