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Business Credit Card Spending Report to IRS?

Business Credit Card Spending Report to IRS?

Old Aug 14, 13, 10:00 am
  #1  
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Business Credit Card Spending Report to IRS?

I recently got the Ink Plus Business Card to get the sign up bonus. I just listed my business as "my name LLC" and used my ssn, I never even got a tax ID. A friend of mine told me I have to report my credit card spending on business cards to the IRS. Is this true? What are the implications if I report I spent ~5K without any income?
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Old Aug 14, 13, 10:08 am
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If your friend said it. It must be true. I would recommend talking to an accountant about it. If you spend 5,000 and don't make any income, that sounds like a loss to me.


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Old Aug 14, 13, 11:12 am
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Thread transferred to Credit Card Programs forum because it is of general interest and not specific to manufactured spending.

Friends and internet forums are not the best source of tax advice. Applying for a "business" credit card does not create a business. Even if you have a business, transactions on a "business" credit card are not necessarily related to that business. The label that the issuer attaches to a credit card is not as important as how the card is actually used.

For an introduction to what you would need to report, start here:

http://www.irs.gov/taxtopics/tc407.html
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Old Aug 14, 13, 11:20 am
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Originally Posted by ibleed0range View Post
I recently got the Ink Plus Business Card to get the sign up bonus. I just listed my business as "my name LLC" and used my ssn, I never even got a tax ID. A friend of mine told me I have to report my credit card spending on business cards to the IRS. Is this true? What are the implications if I report I spent ~5K without any income?
When you do your taxes and you report your expenses , you don't report what spending you put on your "business credit card". You report the EXPENSES themselves. It doesn't matter how you paid for them. They don't even have a section for "expenditures on your business credit card"

If it ever comes to an audit, they just want you to be able to prove you spent the money. Be it cash, check or credit card.
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Old Aug 14, 13, 8:42 pm
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Originally Posted by ibleed0range View Post

I recently got the Ink Plus Business Card to get the sign up bonus. I just listed my business as "my name LLC" and used my ssn, I never even got a tax ID. A friend of mine told me I have to report my credit card spending on business cards to the IRS. Is this true? What are the implications if I report I spent ~5K without any income?
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Not to worry!

The Internal Revenue Code that pertains to credit card reporting does not include the credit card type transactions you described. Even if they did, there is an annual $20,000.00 exemption or 200 transaction each year.

Take a look at this IRS site then you will feel better and stop worrying:

http://www.irs.gov/Businesses/New-10...ement-Entities

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Old Aug 14, 13, 10:17 pm
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Im a tax professional and did prepared thousand of tax returns in years. If you do have a business expenses on your credit card, and its legit or you have a business expenses without income, you should get lil bit more refund if you do it the right way. But be sure to keep all the receipt and credit card statement to back up in case IRS audit you.
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Old Aug 14, 13, 10:37 pm
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Originally Posted by hondaaccordtravel View Post

Im a tax professional and did prepared thousand of tax returns in years. If you do have a business expenses on your credit card, and its legit or you have a business expenses without income, you should get lil bit more refund if you do it the right way. But be sure to keep all the receipt and credit card statement to back up in case IRS audit you.
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Huh!

The original poster was not asking for tax advice or about business expenses.

He was concerned about a new requirement and the Form 1099K that came into existence only a couple of years ago. The form has to do with income, not deductions.

Again, check out the site I provided as it will relieve any concerns expressed by the original poster or concerns others might have over having credit card payments received by a business.
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Old Oct 24, 17, 1:00 pm
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Question

Originally Posted by ibleed0range View Post
I recently got the Ink Plus Business Card to get the sign up bonus. I just listed my business as "my name LLC" and used my ssn, I never even got a tax ID. A friend of mine told me I have to report my credit card spending on business cards to the IRS. Is this true? What are the implications if I report I spent ~5K without any income?
I am in the same situation. I want to get a business card for the signup bonus and am wondering if I can just use I would need to use "my name LLC" and my ssn, since I don't have an official business. I am mainly wondering if the IRS will see that I listed "My Name LLC" on my card application and will start asking why I am not listing an income/taxes for this. Has anyone else done this and can share their experiences?
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Old Oct 24, 17, 1:25 pm
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Never mind...
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Last edited by pkerr; Oct 25, 17 at 7:13 am
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Old Oct 24, 17, 11:20 pm
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Originally Posted by ibleed0range View Post
I just listed my business as "my name LLC" and used my ssn, I never even got a tax ID.
It might be the worst idea ever. A person can be in serious trouble to claim a non-existing LLC.

Originally Posted by ibleed0range View Post
A friend of mine told me I have to report my credit card spending on business cards to the IRS. Is this true?
No. Absolutely not true.

Long story short - the credit card is the mode of payment, similar to cash, checks, etc. Using a business card has nothing to do with the IRS.

On the other hand, spending on personal cards may need to be reported to the IRS depending on the circumstance.

Originally Posted by ibleed0range View Post
What are the implications if I report I spent ~5K without any income?
This question is moot when you have no business.

No business = no business expense = no deduction.

Originally Posted by steventravel View Post
If your friend said it. It must be true.
Hopefully, you have some good friends. Because what you have said is definitely not true at all.

Originally Posted by pkerr View Post
When you do your taxes and you report your expenses , you don't report what spending you put on your "business credit card". You report the EXPENSES themselves. It doesn't matter how you paid for them. They don't even have a section for "expenditures on your business credit card"

If it ever comes to an audit, they just want you to be able to prove you spent the money. Be it cash, check or credit card.
+1

Originally Posted by dgcpaphd View Post
The Internal Revenue Code that pertains to credit card reporting does not include the credit card type transactions you described. Even if they did, there is an annual $20,000.00 exemption or 200 transaction each year.
I believe you totally misunderstand the issue.

Form 1099-K targets taxpayers using platforms like PayPal, Amazon Payment, etc. who RECEIVE payments. OP's issue is about using the credit card to PAY.
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Old Oct 26, 17, 10:15 pm
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Originally Posted by garykung View Post
It might be the worst idea ever. A person can be in serious trouble to claim a non-existing LLC.
Yes. Would it be better to simply mention one's name if using SSN instead of TIN (as SSN relates to personal identity and TIN relates to company identity)?

Originally Posted by garykung View Post
I believe you totally misunderstand the issue.

Form 1099-K targets taxpayers using platforms like PayPal, Amazon Payment, etc. who RECEIVE payments. OP's issue is about using the credit card to PAY.
I was wondering this same thing. However, the OP seems to be concerned with opening a biz card without a biz. What repercussions are actually a potential risk, and what IRS form can be filled to alleviate that risk? I think that is basically what the OP wants to know. I don't have any idea what the answer would be, though.
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Old Oct 27, 17, 3:46 am
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Originally Posted by jonathanmason View Post
Yes. Would it be better to simply mention one's name if using SSN instead of TIN (as SSN relates to personal identity and TIN relates to company identity)?
TIN, or officially ITIN, is for those individuals not eligible for SSNs.

EIN is what identifies a company.

Originally Posted by jonathanmason View Post
I was wondering this same thing. However, the OP seems to be concerned with opening a biz card without a biz. What repercussions are actually a potential risk, and what IRS form can be filled to alleviate that risk? I think that is basically what the OP wants to know. I don't have any idea what the answer would be, though.
There is nothing needed to be done here.
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